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How Should Investors React To 1-800-FLOWERS.COM, Inc.'s (NASDAQ:FLWS) CEO Pay?

Simply Wall St

In 2016 Chris McCann was appointed CEO of 1-800-FLOWERS.COM, Inc. (NASDAQ:FLWS). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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.

See our latest analysis for 1-800-FLOWERS.COM

How Does Chris McCann's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that 1-800-FLOWERS.COM, Inc. has a market cap of US$952m, and reported total annual CEO compensation of US$2.6m for the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at US$775k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. When we examined a selection of companies with market caps ranging from US$400m to US$1.6b, we found the median CEO total compensation was US$3.0m.

So Chris McCann is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.

You can see a visual representation of the CEO compensation at 1-800-FLOWERS.COM, below.

NasdaqGS:FLWS CEO Compensation, March 15th 2020

Is 1-800-FLOWERS.COM, Inc. Growing?

1-800-FLOWERS.COM, Inc. has increased its earnings per share (EPS) by an average of 1.5% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 7.6%.

I would argue that the improvement in revenue isn't particularly impressive, but it is good to see modest EPS growth. 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 1-800-FLOWERS.COM, Inc. Been A Good Investment?

Boasting a total shareholder return of 44% over three years, 1-800-FLOWERS.COM, Inc. has done well by shareholders. 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...

Chris McCann is paid around the same as most CEOs of similar size companies.

While we would like to see improved growth metrics, there is no doubt that the total returns have been great, over the last three years. So considering most shareholders would be happy, we'd say the CEO pay is appropriate. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at 1-800-FLOWERS.COM.

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.

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.

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. Thank you for reading.