How Much is Ramaco Resources, Inc.'s (NASDAQ:METC) CEO Getting Paid?
In 2015, Michael Bauersachs was appointed CEO of Ramaco Resources, Inc. (NASDAQ:METC). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Ramaco Resources
How Does Michael Bauersachs's Compensation Compare With Similar Sized Companies?
Our data indicates that Ramaco Resources, Inc. is worth US$92m, and total annual CEO compensation was reported as US$2.2m for the year to December 2019. Notably, that's an increase of 19% over the year before. We think total compensation is more important but we note that the CEO salary is lower, at US$500k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO total compensation to be US$598k.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. Talking in terms of the sector, salary represented approximately 36% of total compensation out of all the companies we analysed, while other remuneration made up 64% of the pie. It's interesting to note that Ramaco Resources allocates a smaller portion of compensation to salary in comparison to the broader industry.
As you can see, Michael Bauersachs is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Ramaco Resources, Inc. 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, below, how CEO compensation at Ramaco Resources has changed over time.
Is Ramaco Resources, Inc. Growing?
Ramaco Resources, Inc. has seen earnings per share (EPS) move positively by an average of 97% a year, over the last three years (using a line of best fit). Its revenue is up 1.2% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. Shareholders might be interested in this free visualization of analyst forecasts.
Has Ramaco Resources, Inc. Been A Good Investment?
Given the total loss of 64% over three years, many shareholders in Ramaco Resources, Inc. are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
We compared the total CEO remuneration paid by Ramaco Resources, Inc., and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However, the earnings per share growth over three years is certainly impressive. On the other hand returns to investors over the same period have probably disappointed many. So shareholders might not feel great about the fact that CEO pay increased on last year. Considering positive per-share earnings movement, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. Moving away from CEO compensation for the moment, we've identified 3 warning signs for Ramaco Resources that you should be aware of before investing.
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.
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.
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