We Think IES Holdings, Inc.'s (NASDAQ:IESC) CEO Compensation Looks Fair
Key Insights
IES Holdings will host its Annual General Meeting on 22nd of February
Total pay for CEO Jeff Gendell includes US$850.0k salary
The overall pay is comparable to the industry average
Over the past three years, IES Holdings' EPS grew by 35% and over the past three years, the total shareholder return was 129%
The performance at IES Holdings, Inc. (NASDAQ:IESC) has been quite strong recently and CEO Jeff Gendell has played a role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 22nd of February. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.
See our latest analysis for IES Holdings
Comparing IES Holdings, Inc.'s CEO Compensation With The Industry
Our data indicates that IES Holdings, Inc. has a market capitalization of US$2.0b, and total annual CEO compensation was reported as US$3.2m for the year to September 2023. That's a notable increase of 42% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$850k.
For comparison, other companies in the American Construction industry with market capitalizations ranging between US$1.0b and US$3.2b had a median total CEO compensation of US$3.2m. This suggests that IES Holdings remunerates its CEO largely in line with the industry average. What's more, Jeff Gendell holds US$14m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$850k | US$825k | 27% |
Other | US$2.3m | US$1.4m | 73% |
Total Compensation | US$3.2m | US$2.2m | 100% |
Talking in terms of the industry, salary represented approximately 22% of total compensation out of all the companies we analyzed, while other remuneration made up 78% of the pie. IES Holdings pays out 27% of remuneration in the form of a salary, significantly higher than the industry average. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
IES Holdings, Inc.'s Growth
Over the past three years, IES Holdings, Inc. has seen its earnings per share (EPS) grow by 35% per year. In the last year, its revenue is up 7.8%.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has IES Holdings, Inc. Been A Good Investment?
We think that the total shareholder return of 129%, over three years, would leave most IES Holdings, Inc. shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
To Conclude...
Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for IES Holdings that you should be aware of before investing.
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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
