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Does Consolidated Communications Holdings, Inc.'s (NASDAQ:CNSL) CEO Salary Compare Well With Others?

Simply Wall St

Bob Udell became the CEO of Consolidated Communications Holdings, Inc. (NASDAQ:CNSL) in 2015. First, this article will compare CEO compensation with compensation at similar sized companies. 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.

View our latest analysis for Consolidated Communications Holdings

How Does Bob Udell's Compensation Compare With Similar Sized Companies?

According to our data, Consolidated Communications Holdings, Inc. has a market capitalization of US$250m, and paid its CEO total annual compensation worth US$3.2m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$541k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We examined companies with market caps from US$100m to US$400m, and discovered that the median CEO total compensation of that group was US$1.2m.

Thus we can conclude that Bob Udell receives more in total compensation than the median of a group of companies in the same market, and of similar size to Consolidated Communications Holdings, Inc.. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Consolidated Communications Holdings has changed over time.

NasdaqGS:CNSL CEO Compensation, October 30th 2019

Is Consolidated Communications Holdings, Inc. Growing?

Over the last three years Consolidated Communications Holdings, Inc. has shrunk its earnings per share by an average of 38% per year (measured with a line of best fit). Its revenue is down 4.3% over last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.

Has Consolidated Communications Holdings, Inc. Been A Good Investment?

With a three year total loss of 80%, Consolidated Communications Holdings, Inc. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We examined the amount Consolidated Communications Holdings, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

We think many shareholders would be underwhelmed with the business growth over the last three years. Arguably worse, investors are without a positive return for the last three years. In our opinion the CEO might be paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling Consolidated Communications Holdings shares (free trial).

Important note: Consolidated Communications 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.

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 editorial-team@simplywallst.com. 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.