Doug Dietrich became the CEO of Minerals Technologies Inc. (NYSE:MTX) in 2016, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Minerals Technologies pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
How Does Total Compensation For Doug Dietrich Compare With Other Companies In The Industry?
Our data indicates that Minerals Technologies Inc. has a market capitalization of US$2.0b, and total annual CEO compensation was reported as US$5.4m for the year to December 2019. We note that's an increase of 13% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$998k.
On examining similar-sized companies in the industry with market capitalizations between US$1.0b and US$3.2b, we discovered that the median CEO total compensation of that group was US$5.4m. So it looks like Minerals Technologies compensates Doug Dietrich in line with the median for the industry. Furthermore, Doug Dietrich directly owns US$5.0m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, roughly 19% of total compensation represents salary and 81% is other remuneration. Our data reveals that Minerals Technologies allocates salary more or less in line with the wider market. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Minerals Technologies Inc.'s Growth
Over the last three years, Minerals Technologies Inc. has shrunk its earnings per share by 7.9% per year. Its revenue is down 8.2% over the previous year.
The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Minerals Technologies Inc. Been A Good Investment?
Given the total shareholder loss of 19% over three years, many shareholders in Minerals Technologies Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
As we noted earlier, Minerals Technologies pays its CEO in line with similar-sized companies belonging to the same industry. Meanwhile, EPS growth and shareholder returns have been in the red for the last three years. It's tough to call out the compensation as inappropriate, but shareholders might not favor a raise before company performance improves.
CEO compensation can have a massive impact on performance, but it's just one element. We've identified 1 warning sign for Minerals Technologies that investors should be aware of in a dynamic business environment.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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