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In 1997 Ted Fernandez was appointed CEO of The Hackett Group, Inc. (NASDAQ:HCKT). 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Ted Fernandez's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that The Hackett Group, Inc. has a market cap of US$474m, and is paying total annual CEO compensation of US$2.1m. (This is based on the year to December 2018). That's less than last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$750k. We looked at a group of companies with market capitalizations from US$200m to US$800m, and the median CEO total compensation was US$1.5m.
Thus we can conclude that Ted Fernandez receives more in total compensation than the median of a group of companies in the same market, and of similar size to The Hackett Group, Inc.. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Hackett Group has changed from year to year.
Is The Hackett Group, Inc. Growing?
The Hackett Group, Inc. has increased its earnings per share (EPS) by an average of 26% a year, over the last three years (using a line of best fit). It achieved revenue growth of 3.7% over the last year.
This demonstrates that the company has been improving recently. A good result. It's also good to see modest revenue growth, suggesting the underlying business is healthy. It could be important to check this free visual depiction of what analysts expect for the future.
Has The Hackett Group, Inc. Been A Good Investment?
With a total shareholder return of 17% over three years, The Hackett Group, Inc. shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
We compared the total CEO remuneration paid by The Hackett Group, Inc., and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. We also think investors are doing ok, over the same time period. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. Shareholders may want to check for free if Hackett Group insiders are buying or selling shares.
Important note: Hackett Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.