Is Edgewell Personal Care Company’s (NYSE:EPC) CEO Pay Justified?
David Hatfield became the CEO of Edgewell Personal Care Company (NYSE:EPC) in 2015. 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.
See our latest analysis for Edgewell Personal Care
How Does David Hatfield’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Edgewell Personal Care Company has a market cap of US$2.5b, and is paying total annual CEO compensation of US$2m. That’s actually a decrease on the year before. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$2.0b to US$6.4b. The median total CEO compensation was US$5m.
Most shareholders would consider it a positive that David Hatfield takes less 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.
The graphic below shows how CEO compensation at Edgewell Personal Care has changed from year to year.
Is Edgewell Personal Care Company Growing?
Edgewell Personal Care Company has increased its earnings per share (EPS) by an average of 66% a year, over the last three years In the last year, its revenue is down -3.5%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end.
You might want to check this free visual report on analyst forecasts for future earnings.
Has Edgewell Personal Care Company Been A Good Investment?
Since shareholders would have lost about 40% over three years, some Edgewell Personal Care Company shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
In Summary…
It looks like Edgewell Personal Care Company pays its CEO less than similar sized companies. Since the business is growing, many would argue this suggest the pay is modest. Unfortunately, some shareholders may be disappointed with their returns, given the company’s performance over the last three years. We’re not critical of the remuneration David Hatfield receives, but it would be good to see improved returns to shareholders before the remuneration grows too much.
This sort of circumstance certainly justifies further research, because the investment returns might still come in the future. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Edgewell Personal Care Company.
Or you could feast your eyes on this interactive graph depicting past earnings, cash flow 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 editorial-team@simplywallst.com.
