In 1997 Garry Ridge was appointed CEO of WD-40 Company (NASDAQ:WDFC). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Garry Ridge’s Compensation Compare With Similar Sized Companies?
Our data indicates that WD-40 Company is worth US$2.3b, and total annual CEO compensation is US$2.4m. That’s a fairly small increase of 3.3% on year before. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$1.0b to US$3.2b. The median total CEO compensation was US$3.6m.
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, below, how CEO compensation at WD-40 has changed over time.
Is WD-40 Company Growing?
On average over the last three years, WD-40 Company has grown earnings per share (EPS) by 11% each year. In the last year, its revenue is up 7.4%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions.
You might want to check this free visual report on analyst forecasts for future earnings.
Has WD-40 Company Been A Good Investment?
Boasting a total shareholder return of 74% over three years, WD-40 Company has done well by shareholders. This strong performance might mean some shareholders don’t mind if the CEO is paid more than is normal for a company of its size.
It looks like WD-40 Company pays its CEO less than similar sized companies. Since the business is growing, many would argue this suggest the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Garry Ridge deserves a raise!
It’s not often we see shareholders do so well, and yet the CEO is paid modestly. It would be even more positive if company insiders are buying shares.
Or you might rather take a peek at this analytical visualization of historic cash flow, 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 firstname.lastname@example.org.