Paul Sarvadi became the CEO of Insperity, Inc. (NYSE:NSP) in 1989. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. 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.
How Does Paul Sarvadi's Compensation Compare With Similar Sized Companies?
Our data indicates that Insperity, Inc. is worth US$4.2b, and total annual CEO compensation is US$7.2m. (This figure is for the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$1.0m. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$5.1m.
Thus we can conclude that Paul Sarvadi receives more in total compensation than the median of a group of companies in the same market, and of similar size to Insperity, Inc.. However, this doesn't necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see a visual representation of the CEO compensation at Insperity, below.
Is Insperity, Inc. Growing?
Over the last three years Insperity, Inc. has grown its earnings per share (EPS) by an average of 39% per year (using a line of best fit). In the last year, its revenue is up 15%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. It could be important to check this free visual depiction of what analysts expect for the future.
Has Insperity, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Insperity, Inc. for providing a total return of 206% over three years. 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.
We compared total CEO remuneration at Insperity, Inc. with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
However, the earnings per share growth over three years is certainly impressive. On top of that, in the same period, returns to shareholders have been great. So, considering this good performance, the CEO compensation may be quite appropriate. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Insperity (free visualization of insider trades).
If you want to buy a stock that is better than Insperity, this free list of high return, low debt companies is a great place to look.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.