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David Mansfield has been the CEO of Perma-Pipe International Holdings, Inc. (NASDAQ:PPIH) since 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does David Mansfield's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Perma-Pipe International Holdings, Inc. has a market cap of US$74m, and reported total annual CEO compensation of US$890k for the year to January 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$357k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$524k.
It would therefore appear that Perma-Pipe International Holdings, Inc. pays David Mansfield more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Perma-Pipe International Holdings, below.
Is Perma-Pipe International Holdings, Inc. Growing?
Over the last three years Perma-Pipe International Holdings, Inc. has grown its earnings per share (EPS) by an average of 80% per year (using a line of best fit). Its revenue is up 7.4% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Perma-Pipe International Holdings, Inc. Been A Good Investment?
With a total shareholder return of 8.2% over three years, Perma-Pipe International Holdings, Inc. has done okay by shareholders. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
We examined the amount Perma-Pipe International Holdings, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. Looking at the same time period, we think that the shareholder returns are respectable. While it may be worth researching further, we don't see a problem with the CEO pay, given the good EPS growth. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Perma-Pipe International Holdings (free visualization of insider trades).
Important note: Perma-Pipe International Holdings may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned.
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