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Is Fox Factory Holding Corp.'s (NASDAQ:FOXF) CEO Pay Fair?

Simply Wall St

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Larry Enterline has been the CEO of Fox Factory Holding Corp. (NASDAQ:FOXF) since 2011. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Fox Factory Holding

How Does Larry Enterline's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Fox Factory Holding Corp. has a market cap of US$2.8b, and is paying total annual CEO compensation of US$1.9m. (This figure is for the year to December 2018). That's less than last year. While we always look at total compensation first, we note that the salary component is less, at US$750k. We examined companies with market caps from US$2.0b to US$6.4b, and discovered that the median CEO total compensation of that group was US$5.3m.

A first glance this seems like a real positive for shareholders, since Larry Enterline is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.

You can see a visual representation of the CEO compensation at Fox Factory Holding, below.

NasdaqGS:FOXF CEO Compensation, June 18th 2019

Is Fox Factory Holding Corp. Growing?

On average over the last three years, Fox Factory Holding Corp. has grown earnings per share (EPS) by 35% each year (using a line of best fit). Its revenue is up 31% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. You might want to check this free visual report on analyst forecasts for future earnings.

Has Fox Factory Holding Corp. Been A Good Investment?

I think that the total shareholder return of 299%, over three years, would leave most Fox Factory Holding Corp. shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

It appears that Fox Factory Holding Corp. remunerates its CEO below most similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. The pleasing shareholder returns are the cherry on top; you might even consider that Larry Enterline deserves a raise!

It's not often we see shareholders do so well, and yet the CEO is paid modestly. The cherry on top would be if company insiders are buying shares with their own money. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Fox Factory Holding.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity 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 editorial-team@simplywallst.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.