In 2002 Todd Hornbeck was appointed CEO of Hornbeck Offshore Services Inc (NYSE:HOS). First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Todd Hornbeck’s Compensation Compare With Similar Sized Companies?
According to our data, Hornbeck Offshore Services Inc has a market capitalization of US$123m, and pays its CEO total annual compensation worth US$4.6m. (This number is for the twelve months until 2017). While we always look at total compensation first, we note that the salary component is less, at US$638k. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO compensation to be US$295k.
As you can see, Todd Hornbeck is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Hornbeck Offshore Services Inc is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Hornbeck Offshore Services, below.
Is Hornbeck Offshore Services Inc Growing?
On average over the last three years, Hornbeck Offshore Services Inc has shrunk earnings per share by 38% each year. It achieved revenue growth of 21% over the last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Hornbeck Offshore Services Inc Been A Good Investment?
Given the total loss of 71% over three years, many shareholders in Hornbeck Offshore Services Inc are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by Hornbeck Offshore Services Inc, and compared it to remuneration at a group of 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.
Over the same period, investors would have come away with nothing in the way of share price gains. In our opinion the CEO might be paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Hornbeck Offshore Services (free visualization of insider trades).
Or you could feast your eyes on this interactive graph depicting past earnings, cash flow 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.