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In 2014 David Trautman was appointed CEO of Park National Corporation (NYSEMKT:PRK). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. 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.
How Does David Trautman's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Park National Corporation has a market cap of US$1.5b, and is paying total annual CEO compensation of US$1.8m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$785k. We looked at a group of companies with market capitalizations from US$1.0b to US$3.2b, and the median CEO total compensation was US$4.1m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
The graphic below shows how CEO compensation at Park National has changed from year to year.
Is Park National Corporation Growing?
On average over the last three years, Park National Corporation has grown earnings per share (EPS) by 8.8% each year (using a line of best fit). It achieved revenue growth of 4.0% over the last year.
I would argue that the improvement in revenue isn't particularly impressive, but it is good to see modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing. It could be important to check this free visual depiction of what analysts expect for the future.
Has Park National Corporation Been A Good Investment?
Park National Corporation has generated a total shareholder return of 12% 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.
It appears that Park National Corporation remunerates its CEO below most similar sized companies.
David Trautman is paid less than what is normal at similar size companies, and but overall performance has left me uninspired. But on this analysis I see no issue with the CEO compensation. Whatever your view on compensation, you might want to check if insiders are buying or selling Park National shares (free trial).
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.
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