Gus Griffin became the CEO of MGP Ingredients, Inc. (NASDAQ:MGPI) in 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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.
How Does Gus Griffin’s Compensation Compare With Similar Sized Companies?
Our data indicates that MGP Ingredients, Inc. is worth US$1.4b, and total annual CEO compensation is US$1.9m. (This figure is for the year to December 2017). While we always look at total compensation first, we note that the salary component is less, at US$565k. We examined companies with market caps from US$1.0b to US$3.2b, and discovered that the median CEO compensation of that group was US$3.5m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. Though positive, it’s important we delve into the performance of the actual business.
You can see a visual representation of the CEO compensation at MGP Ingredients, below.
Is MGP Ingredients, Inc. Growing?
On average over the last three years, MGP Ingredients, Inc. has grown earnings per share (EPS) by 16% each year (using a line of best fit). It achieved revenue growth of 8.2% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions. You might want to check this free visual report on analyst forecasts for future earnings.
Has MGP Ingredients, Inc. Been A Good Investment?
I think that the total shareholder return of 276%, over three years, would leave most MGP Ingredients, Inc. shareholders smiling. 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.
It appears that MGP Ingredients, Inc. remunerates its CEO below most similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. The strong history of shareholder returns might even have some thinking that Gus Griffin deserves a raise!
It’s not often we see shareholders do so well, and yet the CEO is paid modestly. But it is even better if company insiders are also buying shares with their own money. Shareholders may want to check for free if MGP Ingredients insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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 email@example.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.