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Judy McReynolds has been the CEO of ArcBest Corporation (NASDAQ:ARCB) since 2010, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for ArcBest.
How Does Total Compensation For Judy McReynolds Compare With Other Companies In The Industry?
Our data indicates that ArcBest Corporation has a market capitalization of US$703m, and total annual CEO compensation was reported as US$2.4m for the year to December 2019. That's a notable decrease of 41% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$744k.
For comparison, other companies in the same industry with market capitalizations ranging between US$400m and US$1.6b had a median total CEO compensation of US$1.2m. Accordingly, our analysis reveals that ArcBest Corporation pays Judy McReynolds north of the industry median. Furthermore, Judy McReynolds directly owns US$2.2m worth of shares in the company.
Speaking on an industry level, nearly 24% of total compensation represents salary, while the remainder of 76% is other remuneration. ArcBest pays out 31% of remuneration in the form of a salary, significantly higher than the industry average. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at ArcBest Corporation's Growth Numbers
ArcBest Corporation has seen its earnings per share (EPS) increase by 29% a year over the past three years. In the last year, its revenue is down 4.1%.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. 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 ArcBest Corporation Been A Good Investment?
ArcBest Corporation has generated a total shareholder return of 29% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
As we noted earlier, ArcBest pays its CEO higher than the norm for similar-sized companies belonging to the same industry. However, we must not forget that the EPS growth has been very strong over three years. We also think investor returns are steady over the same time period. So, considering the EPS growth we do not wish to criticize CEO compensation, though we'd recommend further research on management.
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 4 warning signs for ArcBest that investors should look into moving forward.
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.
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.
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