In 2017 Craig Forman was appointed CEO of The McClatchy Company (NYSEMKT:MNI). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Craig Forman's Compensation Compare With Similar Sized Companies?
According to our data, The McClatchy Company has a market capitalization of US$20m, and pays its CEO total annual compensation worth US$2.9m. (This is based on the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$981k. 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$498k.
As you can see, Craig Forman is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean The McClatchy Company is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at McClatchy has changed over time.
Is The McClatchy Company Growing?
The McClatchy Company has reduced its earnings per share by an average of 8.4% a year, over the last three years (measured with a line of best fit). Its revenue is down -11% over last year.
Sadly for shareholders, earnings per share are actually down, 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. It could be important to check this free visual depiction of what analysts expect for the future.
Has The McClatchy Company Been A Good Investment?
Since shareholders would have lost about 86% over three years, some The McClatchy Company shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We compared total CEO remuneration at The McClatchy Company with the amount paid at companies with a similar market capitalization. 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 fast to impress us, over the last three years.
Just as bad, share price gains for investors have failed to materialize, over the same period. In our opinion the CEO might be paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling McClatchy (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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