Patrick Williams has been the CEO of Innospec Inc (NASDAQ:IOSP) since 2009. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Patrick Williams’s Compensation Compare With Similar Sized Companies?
Our data indicates that Innospec Inc is worth US$1.6b, and total annual CEO compensation is US$7m. That’s a fairly small increase of 7.6% on year before. When we examined a selection of companies with market caps ranging from US$1.0b to US$3.2b, we found the median CEO compensation was US$4m.
As you can see, Patrick Williams is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Innospec Inc is paying too much. 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 a visual representation of the CEO compensation at Innospec, below.
Is Innospec Inc Growing?
Innospec Inc has reduced its earnings per share by an average of 22% a year, over the last three years. Its revenue is up 32% over last year.
As investors, we do are a bit wary of companies that have lower earnings per share, over three years. On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can’t form a strong opinion about business performance yet; but it’s one worth watching.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Innospec Inc Been A Good Investment?
Innospec Inc has served shareholders reasonably well, with a total return of 26% over three years. But they probably don’t want to see the CEO paid more than is normal for companies around the same size.
We compared total CEO remuneration at Innospec Inc with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. In conclusion we think the company should definitely focus on improving the business before awarding any large pay rises. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Innospec Inc (free visualization of insider trades).
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 firstname.lastname@example.org.