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Tom Goeke has been the CEO of Milacron Holdings Corp. (NYSE:MCRN) since 2012. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Tom Goeke's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Milacron Holdings Corp. has a market cap of US$876m, and is paying total annual CEO compensation of US$4.4m. (This figure is for the year to December 2018). That's a fairly small increase of 6.7% on year before. While we always look at total compensation first, we note that the salary component is less, at US$881k. We looked at a group of companies with market capitalizations from US$400m to US$1.6b, and the median CEO total compensation was US$2.7m.
As you can see, Tom Goeke is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Milacron Holdings Corp. 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.
The graphic below shows how CEO compensation at Milacron Holdings has changed from year to year.
Is Milacron Holdings Corp. Growing?
Over the last three years Milacron Holdings Corp. has grown its earnings per share (EPS) by an average of 43% per year (using a line of best fit). It saw its revenue drop -1.6% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Shareholders might be interested in this free visualization of analyst forecasts.
Has Milacron Holdings Corp. Been A Good Investment?
Given the total loss of 28% over three years, many shareholders in Milacron Holdings Corp. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
We compared the total CEO remuneration paid by Milacron Holdings Corp., and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However, the earnings per share growth over three years is certainly impressive. However, the returns to investors are far less impressive, over the same period. Considering the per share profit growth, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. Whatever your view on compensation, you might want to check if insiders are buying or selling Milacron Holdings shares (free trial).
Important note: Milacron Holdings may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE 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.