Bob Schottenstein has been the CEO of M/I Homes Inc (NYSE:MHO) since 2004. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. 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 Bob Schottenstein’s Compensation Compare With Similar Sized Companies?
According to our data, M/I Homes Inc has a market capitalization of US$677m, and pays its CEO total annual compensation worth US$4.8m. (This number is for the twelve months until 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$900k. We looked at a group of companies with market capitalizations from US$400m to US$1.6b, and the median CEO compensation was US$2.3m.
It would therefore appear that M/I Homes Inc pays Bob Schottenstein 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 better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at M/I Homes has changed from year to year.
Is M/I Homes Inc Growing?
Over the last three years M/I Homes Inc has grown its earnings per share (EPS) by an average of 19% per year. Its revenue is up 17% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. IThis sort of respectable year-on-year revenue growth is often seen at a healthy, growing business.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has M/I Homes Inc Been A Good Investment?
M/I Homes Inc has generated a total shareholder return of 1.9% over three years, so most shareholders wouldn’t be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared total CEO remuneration at M/I Homes Inc with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. Looking at the same time period, we think that the shareholder returns are respectable. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn’t call the CEO pay problematic. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at M/I Homes.
Or you might rather take a peek at this analytical visualization of historic cash flow, 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.