R. Allison became the CEO of Addus HomeCare Corporation (NASDAQ:ADUS) in 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. 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.
How Does R. Allison's Compensation Compare With Similar Sized Companies?
According to our data, Addus HomeCare Corporation has a market capitalization of US$1.3b, and paid its CEO total annual compensation worth US$2.9m over the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$589k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. 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$4.0m.
So R. Allison receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at Addus HomeCare has changed over time.
Is Addus HomeCare Corporation Growing?
Addus HomeCare Corporation has increased its earnings per share (EPS) by an average of 15% a year, over the last three years (using a line of best fit). Its revenue is up 24% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Shareholders might be interested in this free visualization of analyst forecasts.
Has Addus HomeCare Corporation Been A Good Investment?
Most shareholders would probably be pleased with Addus HomeCare Corporation for providing a total return of 225% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
R. Allison is paid around what is normal the leaders of comparable size companies.
The company is growing earnings per share and total shareholder returns have been pleasing. Indeed, many might consider the pay rather modest, given the solid company performance! Shareholders may want to check for free if Addus HomeCare insiders are buying or selling shares.
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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If you spot an error that warrants correction, please contact the editor at email@example.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.