Richard Hayne has been the CEO of Urban Outfitters, Inc. (NASDAQ:URBN) since 2012. First, this article will compare CEO compensation with compensation at similar sized companies. 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 Richard Hayne's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Urban Outfitters, Inc. has a market cap of US$2.2b, and is paying total annual CEO compensation of US$1.0m. (This is based on the year to January 2019). While we always look at total compensation first, we note that the salary component is less, at US$1.0. When we examined a selection of companies with market caps ranging from US$1.0b to US$3.2b, we found the median CEO total compensation was US$4.0m.
Most shareholders would consider it a positive that Richard Hayne takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Urban Outfitters has changed over time.
Is Urban Outfitters, Inc. Growing?
Over the last three years Urban Outfitters, Inc. has grown its earnings per share (EPS) by an average of 8.9% per year (using a line of best fit). It achieved revenue growth of 6.7% over the last year.
I'm not particularly impressed by the revenue growth, but the modest improvement in EPS is good. So there are some positives here, but not enough to earn high praise. Shareholders might be interested in this free visualization of analyst forecasts.
Has Urban Outfitters, Inc. Been A Good Investment?
Since shareholders would have lost about 25% over three years, some Urban Outfitters, Inc. shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
Urban Outfitters, Inc. is currently paying its CEO below what is normal for companies of its size.
Richard Hayne is paid less than CEOs of similar size companies, but growth hasn't been particularly impressive and the total shareholder return over three years would leave many disappointed. Many shareholders would probably like to see improvements, but our analysis does not suggest that CEO compensation is too generous. Shareholders may want to check for free if Urban Outfitters insiders are buying or selling shares.
If you want to buy a stock that is better than Urban Outfitters, this free list of high return, low debt companies is a great place to look.
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