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Is Matthews International Corporation's (NASDAQ:MATW) CEO Being Overpaid?

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Joseph Bartolacci became the CEO of Matthews International Corporation (NASDAQ:MATW) in 2006. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Matthews International

How Does Joseph Bartolacci's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Matthews International Corporation has a market cap of US$1.0b, and reported total annual CEO compensation of US$6.6m for the year to September 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$874k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO total compensation of that group was US$2.7m.

As you can see, Joseph Bartolacci is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Matthews International Corporation is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see a visual representation of the CEO compensation at Matthews International, below.

NasdaqGS:MATW CEO Compensation, October 4th 2019
NasdaqGS:MATW CEO Compensation, October 4th 2019

Is Matthews International Corporation Growing?

Over the last three years Matthews International Corporation has grown its earnings per share (EPS) by an average of 7.4% per year (using a line of best fit). Its revenue is down 2.4% over last year.

I generally like to see a little revenue growth, but the improvement in EPS is good. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. You might want to check this free visual report on analyst forecasts for future earnings.

Has Matthews International Corporation Been A Good Investment?

Since shareholders would have lost about 44% over three years, some Matthews International Corporation shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We compared total CEO remuneration at Matthews International Corporation with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.

While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Matthews International (free visualization of insider trades).

If you want to buy a stock that is better than Matthews International, this free list of high return, low debt companies is a great place to look.

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.