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Is Steven Madden, Ltd. (NASDAQ:SHOO) Excessively Paying Its CEO?

Simply Wall St

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In 2008 Ed Rosenfeld was appointed CEO of Steven Madden, Ltd. (NASDAQ:SHOO). First, this article will compare CEO compensation with compensation at similar sized companies. 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 process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Steven Madden

How Does Ed Rosenfeld's Compensation Compare With Similar Sized Companies?

Our data indicates that Steven Madden, Ltd. is worth US$3.1b, and total annual CEO compensation is US$2.9m. (This number is for the twelve months until December 2017). While we always look at total compensation first, we note that the salary component is less, at US$849k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$2.0b to US$6.4b. The median total CEO compensation was US$5.1m.

This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.

You can see a visual representation of the CEO compensation at Steven Madden, below.

NasdaqGS:SHOO CEO Compensation, May 2nd 2019

Is Steven Madden, Ltd. Growing?

Over the last three years Steven Madden, Ltd. has grown its earnings per share (EPS) by an average of 8.0% per year (using a line of best fit). It achieved revenue growth of 6.8% over the last year.

I would argue that the improvement in revenue isn't particularly impressive, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. It could be important to check this free visual depiction of what analysts expect for the future.

Has Steven Madden, Ltd. Been A Good Investment?

I think that the total shareholder return of 58%, over three years, would leave most Steven Madden, Ltd. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

It looks like Steven Madden, Ltd. pays its CEO less than similar sized companies.

Ed Rosenfeld receives relatively low remuneration compared to similar sized companies. And the returns to shareholders were great, over the last few years. So, while it might be nice to have better EPS growth, on our analysis the CEO compensation is quite modest. Whatever your view on compensation, you might want to check if insiders are buying or selling Steven Madden shares (free trial).

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 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.