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Is Thermon Group Holdings, Inc.'s (NYSE:THR) CEO Overpaid Relative To Its Peers?

Simply Wall St

In 2016 Bruce Thames was appointed CEO of Thermon Group Holdings, Inc. (NYSE:THR). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. 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.

See our latest analysis for Thermon Group Holdings

How Does Bruce Thames's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Thermon Group Holdings, Inc. has a market cap of US$704m, and is paying total annual CEO compensation of US$3.1m. (This figure is for the year to March 2019). We note that's an increase of 38% above last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$618k. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO total compensation of that group was US$2.7m.

So Bruce Thames receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

The graphic below shows how CEO compensation at Thermon Group Holdings has changed from year to year.

NYSE:THR CEO Compensation, August 30th 2019

Is Thermon Group Holdings, Inc. Growing?

Thermon Group Holdings, Inc. has increased its earnings per share (EPS) by an average of 6.6% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 20%.

I would argue that the modest growth in revenue is a notable positive. And the improvement in earnings per share is modest but respectable. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. Shareholders might be interested in this free visualization of analyst forecasts.

Has Thermon Group Holdings, Inc. Been A Good Investment?

Thermon Group Holdings, Inc. has generated a total shareholder return of 13% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

Bruce Thames is paid around what is normal the leaders of comparable size companies.

We see room for improved growth, as well as fairly unremarkable returns over the last three years. While the CEO may not be underpaid, we don't think the pay is too generous either. Whatever your view on compensation, you might want to check if insiders are buying or selling Thermon Group Holdings shares (free trial).

If you want to buy a stock that is better than Thermon Group Holdings, this free list of high return, low debt companies is a great place to look.

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.