Is Sykes Enterprises, Incorporated’s (NASDAQ:SYKE) CEO Salary Justified?
Chuck Sykes has been the CEO of Sykes Enterprises, Incorporated (NASDAQ:SYKE) since 2004. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. This method should give us information to assess how appropriately the company pays the CEO.
View our latest analysis for Sykes Enterprises
How Does Chuck Sykes’s Compensation Compare With Similar Sized Companies?
According to our data, Sykes Enterprises, Incorporated has a market capitalization of US$1.1b, and pays its CEO total annual compensation worth US$4.2m. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$733k. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO compensation of that group was US$2.3m.
Thus we can conclude that Chuck Sykes receives more in total compensation than the median of a group of companies in the same market, and of similar size to Sykes Enterprises, Incorporated. However, this doesn’t necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Sykes Enterprises has changed over time.
Is Sykes Enterprises, Incorporated Growing?
Over the last three years Sykes Enterprises, Incorporated has shrunk its earnings per share by an average of 34% per year. It achieved revenue growth of 4.7% over the last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. The fairly low revenue growth fails to impress given that the earnings per share is down. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Sykes Enterprises, Incorporated Been A Good Investment?
Since shareholders would have lost about 4.6% over three years, some Sykes Enterprises, Incorporated shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary…
We compared the total CEO remuneration paid by Sykes Enterprises, Incorporated, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.
Arguably worse, investors are without a positive return for the last three years. Some might well form the view 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 Sykes Enterprises (free visualization of insider trades).
Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
