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Is Pyxus International, Inc.'s (NYSE:PYX) CEO Overpaid Relative To Its Peers?

Simply Wall St

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J. Sikkel became the CEO of Pyxus International, Inc. (NYSE:PYX) in 2013. 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 - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Pyxus International

How Does J. Sikkel's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Pyxus International, Inc. has a market cap of US$209m, and is paying total annual CEO compensation of US$1.5m. (This number is for the twelve months until March 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$642k. When we examined a selection of companies with market caps ranging from US$100m to US$400m, we found the median CEO total compensation was US$1.0m.

As you can see, J. Sikkel is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Pyxus International, 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.

The graphic below shows how CEO compensation at Pyxus International has changed from year to year.

NYSE:PYX CEO Compensation, May 1st 2019

Is Pyxus International, Inc. Growing?

On average over the last three years, Pyxus International, Inc. has shrunk earnings per share by 10% each year (measured with a line of best fit). It achieved revenue growth of 2.3% over the last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.

Has Pyxus International, Inc. Been A Good Investment?

Since shareholders would have lost about 9.7% over three years, some Pyxus International, Inc. shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We examined the amount Pyxus International, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Earnings per share have not grown in three years, and the revenue growth fails to impress us.

Arguably worse, investors are without a positive return for the last three years. This analysis suggests to us that the CEO is paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Pyxus International (free visualization of insider trades).

Important note: Pyxus International may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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 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. Thank you for reading.