Al Rankin became the CEO of Hyster-Yale Materials Handling Inc (NYSE:HY) in 2012. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Al Rankin’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Hyster-Yale Materials Handling Inc has a market cap of US$1.0b, and is paying total annual CEO compensation of US$4.4m. That’s a notable increase of 55% on last year. We looked at a group of companies with market capitalizations from US$400m to US$1.6b, and the median CEO compensation was US$2.2m.
It would therefore appear that Hyster-Yale Materials Handling Inc pays Al Rankin more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration 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 Hyster-Yale Materials Handling has changed over time.
Is Hyster-Yale Materials Handling Inc Growing?
On average over the last three years, Hyster-Yale Materials Handling Inc has shrunk earnings per share by 24% each year. It achieved revenue growth of 13% over the last year.
Sadly for shareholders, earnings per share are actually down, over three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Hyster-Yale Materials Handling Inc Been A Good Investment?
Hyster-Yale Materials Handling Inc has generated a total shareholder return of 22% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared total CEO remuneration at Hyster-Yale Materials Handling Inc with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.
And while shareholder returns have been respectable, they have hardly been superb. We also note that the CEO compensation is well up on last year. So we doubt many shareholders would consider the CEO pay to be particularly modest! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Hyster-Yale Materials Handling Inc (free visualization of insider trades).
Or you might prefer examine intently this intuitive graph showing past earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.