In 1967 Harold Hamm was appointed CEO of Continental Resources, Inc. (NYSE:CLR). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Harold Hamm's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Continental Resources, Inc. has a market cap of US$11b, and reported total annual CEO compensation of US$13m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$1.3m. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO total compensation was US$11m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
So Harold Hamm is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
The graphic below shows how CEO compensation at Continental Resources has changed from year to year.
Is Continental Resources, Inc. Growing?
Continental Resources, Inc. has increased its earnings per share (EPS) by an average of 78% a year, over the last three years (using a line of best fit). Its revenue is down 1.7% over last year.
This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. You might want to check this free visual report on analyst forecasts for future earnings.
Has Continental Resources, Inc. Been A Good Investment?
With a three year total loss of 44%, Continental Resources, Inc. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Harold Hamm is paid around the same as most CEOs of large companies.
We like that the company is growing EPS, but we cannot say the same about the lacklustre shareholder returns (over the last three years). Considering the the positives we don't think the CEO pays is too high, but it's certainly hard to argue it is too low. So you may want to check if insiders are buying Continental Resources shares with their own money (free access).
If you want to buy a stock that is better than Continental Resources, this free list of high return, low debt companies is a great place to look.
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