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Is Innophos Holdings, Inc. (NASDAQ:IPHS) Excessively Paying Its CEO?

Simply Wall St

Kim Mink has been the CEO of Innophos Holdings, Inc. (NASDAQ:IPHS) since 2015. 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. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Innophos Holdings

How Does Kim Mink's Compensation Compare With Similar Sized Companies?

Our data indicates that Innophos Holdings, Inc. is worth US$539m, and total annual CEO compensation is US$3.4m. (This figure is for the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$838k. We looked at a group of companies with market capitalizations from US$200m to US$800m, and the median CEO total compensation was US$1.8m.

It would therefore appear that Innophos Holdings, Inc. pays Kim Mink more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Innophos Holdings has changed over time.

NasdaqGS:IPHS CEO Compensation, July 24th 2019

Is Innophos Holdings, Inc. Growing?

Over the last three years Innophos Holdings, Inc. has shrunk its earnings per share by an average of 8.8% per year (measured with a line of best fit). In the last year, its revenue is up 3.5%.

Few shareholders would be pleased to read that earnings per share are lower over three years. The fairly low revenue growth fails to impress given that the earnings per share is down. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.

Has Innophos Holdings, Inc. Been A Good Investment?

Given the total loss of 28% over three years, many shareholders in Innophos Holdings, Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We examined the amount Innophos Holdings, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

Earnings per share have not grown in three years, and the revenue growth fails to impress us.

Arguably worse, investors are without a positive return for the last three years. This analysis suggests to us that the CEO is paid too generously! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Innophos Holdings.

Important note: Innophos 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 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.