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David Mansfield has been the CEO of Perma-Pipe International Holdings, Inc. (NASDAQ:PPIH) since 2016. First, this article will compare CEO compensation with compensation at similar sized companies. 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. This process should give us an idea about how appropriately the CEO is paid.
How Does David Mansfield's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Perma-Pipe International Holdings, Inc. has a market cap of US$72m, and is paying total annual CEO compensation of US$890k. (This is based on the year to January 2019). That's a modest increase of 3.4% on the prior year year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$357k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$451k.
As you can see, David Mansfield is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Perma-Pipe International Holdings, Inc. is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Perma-Pipe International Holdings has changed from year to year.
Is Perma-Pipe International Holdings, Inc. Growing?
On average over the last three years, Perma-Pipe International Holdings, Inc. has grown earnings per share (EPS) by 20% each year (using a line of best fit). It achieved revenue growth of 12% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Perma-Pipe International Holdings, Inc. Been A Good Investment?
With a total shareholder return of 21% over three years, Perma-Pipe International Holdings, 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 Perma-Pipe International Holdings, 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.
However, the earnings per share growth over three years is certainly impressive. We also note that, over the same time frame, shareholder returns haven't been bad. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. Whatever your view on compensation, you might want to check if insiders are buying or selling Perma-Pipe International Holdings shares (free trial).
Important note: Perma-Pipe International Holdings 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.