- Oops!Something went wrong.Please try again later.
Alan McKim became the CEO of Clean Harbors, Inc. (NYSE:CLH) in 1980, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Clean Harbors pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Comparing Clean Harbors, Inc.'s CEO Compensation With the industry
At the time of writing, our data shows that Clean Harbors, Inc. has a market capitalization of US$4.1b, and reported total annual CEO compensation of US$4.1m for the year to December 2019. We note that's a decrease of 17% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.3m.
For comparison, other companies in the same industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$4.6m. From this we gather that Alan McKim is paid around the median for CEOs in the industry. Furthermore, Alan McKim directly owns US$273m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, roughly 23% of total compensation represents salary and 77% is other remuneration. Clean Harbors pays out 31% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Clean Harbors, Inc.'s Growth
Clean Harbors, Inc.'s earnings per share (EPS) grew 218% per year over the last three years. Its revenue is down 5.3% over the previous year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Clean Harbors, Inc. Been A Good Investment?
Boasting a total shareholder return of 38% over three years, Clean Harbors, Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
As previously discussed, Alan is compensated close to the median for companies of its size, and which belong to the same industry. Investors would surely be happy to see that returns have been great, and that EPS is up. Indeed, many might consider that Alan is compensated rather modestly, given the solid company performance! In fact, shareholders might even think the CEO deserves a raise as a reward due to the fantastic returns generated.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 3 warning signs for Clean Harbors that investors should look into moving forward.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email email@example.com.