Does Hecla Mining Company's (NYSE:HL) CEO Pay Matter?
Phillips Baker has been the CEO of Hecla Mining Company (NYSE:HL) since 2003. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. 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.
See our latest analysis for Hecla Mining
How Does Phillips Baker's Compensation Compare With Similar Sized Companies?
Our data indicates that Hecla Mining Company is worth US$985m, and total annual CEO compensation was reported as US$3.7m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$635k. 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$400m to US$1.6b, and discovered that the median CEO total compensation of that group was US$2.7m.
As you can see, Phillips Baker is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Hecla Mining Company is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Hecla Mining has changed over time.
Is Hecla Mining Company Growing?
Hecla Mining Company has reduced its earnings per share by an average of 68% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is down 3.6%.
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. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.
Has Hecla Mining Company Been A Good Investment?
Given the total loss of 65% over three years, many shareholders in Hecla Mining Company are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
We compared the total CEO remuneration paid by Hecla Mining Company, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. Over the same period, investors would have come away with nothing in the way of share price gains. This analysis suggests to us that the CEO is paid too generously! Shareholders may want to check for free if Hecla Mining insiders are buying or selling shares.
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 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.
