Jeff Fisher has been the CEO of Chatham Lodging Trust (NYSE:CLDT) since 2009. 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 – as a second measure of performance – we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
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How Does Jeff Fisher’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Chatham Lodging Trust has a market cap of US$850m, and is paying total annual CEO compensation of US$4.0m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$600k. We looked at a group of companies with market capitalizations from US$400m to US$1.6b, and the median CEO compensation was US$2.3m.
Thus we can conclude that Jeff Fisher receives more in total compensation than the median of a group of companies in the same market, and of similar size to Chatham Lodging Trust. However, this doesn’t necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Chatham Lodging Trust has changed over time.
Is Chatham Lodging Trust Growing?
On average over the last three years, Chatham Lodging Trust has shrunk earnings per share by 3.2% each year. It achieved revenue growth of 6.6% over the last year.
Sadly for shareholders, earnings per share are actually down, over three years. And the modest revenue growth over 12 months isn’t much comfort against the reduced earnings per share. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Chatham Lodging Trust Been A Good Investment?
Boasting a total shareholder return of 38% over three years, Chatham Lodging Trust has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
We examined the amount Chatham Lodging Trust pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
Earnings per share have not grown in three years, and the revenue growth fails to impress us.
However, we can’t argue with the strong returns to shareholders, over the same time period. So on this analysis we’d stop short of criticizing the level of CEO compensation. Whatever your view on compensation, you might want to check if insiders are buying or selling Chatham Lodging Trust shares (free trial).
Or you might prefer examine intently this intuitive graph showing past 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 email@example.com.