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Kevin McNamara became the CEO of Chemed Corporation (NYSE:CHE) in 2001. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. 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 Kevin McNamara's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Chemed Corporation has a market cap of US$5.2b, and is paying total annual CEO compensation of US$7.9m. (This figure is for the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$1.1m. We examined companies with market caps from US$4.0b to US$12b, and discovered that the median CEO total compensation of that group was US$6.4m.
That means Kevin McNamara receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at Chemed, below.
Is Chemed Corporation Growing?
Chemed Corporation has increased its earnings per share (EPS) by an average of 26% a year, over the last three years (using a line of best fit). It achieved revenue growth of 7.0% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Shareholders might be interested in this free visualization of analyst forecasts.
Has Chemed Corporation Been A Good Investment?
Most shareholders would probably be pleased with Chemed Corporation for providing a total return of 144% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Kevin McNamara is paid around what is normal the leaders of comparable size companies.
Shareholders would surely be happy to see that shareholder returns have been great, and the earnings per share are up. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. Shareholders may want to check for free if Chemed insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
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. Thank you for reading.