Linda Massman has been the CEO of Clearwater Paper Corporation (NYSE:CLW) since 2013. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Linda Massman's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Clearwater Paper Corporation has a market cap of US$271m, and is paying total annual CEO compensation of US$4.0m. (This number is for the twelve months until December 2018). While we always look at total compensation first, we note that the salary component is less, at US$925k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO total compensation was US$1.2m.
Thus we can conclude that Linda Massman receives more in total compensation than the median of a group of companies in the same market, and of similar size to Clearwater Paper Corporation. However, this doesn't necessarily mean the pay is too high. 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 Clearwater Paper, below.
Is Clearwater Paper Corporation Growing?
Over the last three years Clearwater Paper Corporation has shrunk its earnings per share by an average of 67% per year (measured with a line of best fit). In the last year, its revenue changed by just 0.2%.
Unfortunately, earnings per share have trended lower over the last three years. And the flat revenue is seriously uninspiring. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.
Has Clearwater Paper Corporation Been A Good Investment?
With a three year total loss of 73%, Clearwater Paper Corporation would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by Clearwater Paper Corporation, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
Over the same period, investors would have come away with nothing in the way of share price gains. In our opinion the CEO might be paid too generously! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Clearwater Paper.
If you want to buy a stock that is better than Clearwater Paper, this free list of high return, low debt companies is a great place to look.
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