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In 1992 Boyd Hoback was appointed CEO of Good Times Restaurants Inc. (NASDAQ:GTIM). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Boyd Hoback's Compensation Compare With Similar Sized Companies?
Our data indicates that Good Times Restaurants Inc. is worth US$30m, and total annual CEO compensation is US$500k. (This figure is for the year to September 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$238k. 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$427k.
So Boyd Hoback 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.
You can see a visual representation of the CEO compensation at Good Times Restaurants, below.
Is Good Times Restaurants Inc. Growing?
On average over the last three years, Good Times Restaurants Inc. has shrunk earnings per share by 2.0% each year (measured with a line of best fit). Its revenue is up 19% over last year.
Unfortunately there is a complete lack of earnings per share improvement, over three years. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. It could be important to check this free visual depiction of what analysts expect for the future.
Has Good Times Restaurants Inc. Been A Good Investment?
Since shareholders would have lost about 37% over three years, some Good Times Restaurants Inc. shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
Boyd Hoback is paid around the same as most CEOs of similar size companies.
The company isn't growing EPS, and shareholder returns have been disappointing. Suffice it to say, we don't think the CEO is underpaid! So you may want to check if insiders are buying Good Times Restaurants shares with their own money (free access).
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity 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 email@example.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.