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Should You Worry About Robert Half International Inc.'s (NYSE:RHI) CEO Pay Cheque?

Simply Wall St

Max Messmer has been the CEO of Robert Half International Inc. (NYSE:RHI) since 1987. 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 - 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.

View our latest analysis for Robert Half International

How Does Max Messmer's Compensation Compare With Similar Sized Companies?

According to our data, Robert Half International Inc. has a market capitalization of US$7.1b, and pays its CEO total annual compensation worth US$9.1m. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$525k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12b. The median total CEO compensation was US$6.8m.

As you can see, Max Messmer is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Robert Half International 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 Robert Half International, below.

NYSE:RHI CEO Compensation, July 27th 2019

Is Robert Half International Inc. Growing?

On average over the last three years, Robert Half International Inc. has grown earnings per share (EPS) by 12% each year (using a line of best fit). Its revenue is up 7.4% over last year.

This demonstrates that the company has been improving recently. A good result. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. You might want to check this free visual report on analyst forecasts for future earnings.

Has Robert Half International Inc. Been A Good Investment?

Most shareholders would probably be pleased with Robert Half International Inc. for providing a total return of 77% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

We compared the total CEO remuneration paid by Robert Half International 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 we must not forget that the EPS growth has been very strong over three years. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Robert Half International.

Important note: Robert Half International 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 editorial-team@simplywallst.com. 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.