In 2009 Howard Brecher was appointed CEO of Value Line, Inc. (NASDAQ:VALU). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Howard Brecher's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Value Line, Inc. has a market cap of US$227m, and reported total annual CEO compensation of US$823k for the year to April 2019. Notably, that's an increase of 16% over the year before. We think total compensation is more important but we note that the CEO salary is lower, at US$625k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$100m to US$400m. The median total CEO compensation was US$1.2m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see a visual representation of the CEO compensation at Value Line, below.
Is Value Line, Inc. Growing?
Value Line, Inc. has increased its earnings per share (EPS) by an average of 9.2% a year, over the last three years (using a line of best fit). Its revenue is up 2.7% over last year.
I would argue that the improvement in revenue isn't particularly impressive, but the modest improvement in EPS is good. Considering these factors I'd say performance has been pretty decent, though not amazing. Although we don't have analyst forecasts shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Value Line, Inc. Been A Good Investment?
Boasting a total shareholder return of 51% over three years, Value Line, Inc. has done well by shareholders. 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.
It appears that Value Line, Inc. remunerates its CEO below most similar sized companies.
Howard Brecher receives relatively low remuneration compared to similar sized companies. And the returns to shareholders were great, over the last few years. Although we could see higher growth, we'd argue the remuneration is modest, based on these observations. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Value Line (free visualization of insider trades).
If you want to buy a stock that is better than Value Line, this free list of high return, low debt companies is a great place to look.
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