In 2016 Randy Baker was appointed CEO of Actuant Corporation (NYSE:ATU). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Randy Baker's Compensation Compare With Similar Sized Companies?
Our data indicates that Actuant Corporation is worth US$1.6b, and total annual CEO compensation is US$4.7m. (This is based on the year to August 2018). While we always look at total compensation first, we note that the salary component is less, at US$867k. We looked at a group of companies with market capitalizations from US$1.0b to US$3.2b, and the median CEO total compensation was US$3.6m.
So Randy Baker is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at Actuant has changed from year to year.
Is Actuant Corporation Growing?
Actuant Corporation has increased its earnings per share (EPS) by an average of 23% a year, over the last three years (using a line of best fit). Its revenue is up 4.2% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.
Has Actuant Corporation Been A Good Investment?
Since shareholders would have lost about 3.0% over three years, some Actuant Corporation shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
Randy Baker is paid around the same as most CEOs of similar size companies.
We think that the EPS growth is very pleasing, but we find the returns over the last three years to be lacking. We'd be surprised if shareholders want to see a pay rise for the CEO, but we'd stop short of calling their pay too generous. Whatever your view on compensation, you might want to check if insiders are buying or selling Actuant shares (free trial).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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