Yahoo Finance Is Clean Harbors, Inc.’s (NYSE:CLH) CEO Overpaid Relative To Its Peers?
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Alan McKim became the CEO of Clean Harbors, Inc. (NYSE:CLH) in 1980. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Clean Harbors
How Does Alan McKim’s Compensation Compare With Similar Sized Companies?
According to our data, Clean Harbors, Inc. has a market capitalization of US$3.3b, and pays its CEO total annual compensation worth US$3.0m. (This figure is for the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$1.3m. We looked at a group of companies with market capitalizations from US$2.0b to US$6.4b, and the median CEO compensation was US$4.8m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you’ll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Clean Harbors has changed over time.
Is Clean Harbors, Inc. Growing?
Over the last three years Clean Harbors, Inc. has grown its earnings per share (EPS) by an average of 53% per year (using a line of best fit). Its revenue is up 10% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Clean Harbors, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Clean Harbors, Inc. for providing a total return of 37% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary…
Clean Harbors, Inc. is currently paying its CEO below what is normal for companies of its size. Considering the underlying business is growing earnings, this would suggest the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Alan McKim deserves a raise!
Most shareholders like to see a modestly paid CEO combined with strong performance by the company. It would be even more positive if company insiders are buying shares. So you may want to check if insiders are buying Clean Harbors shares with their own money (free access).
If you want to buy a stock that is better than Clean Harbors, this free list of high return, low debt companies is a great place to look.
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 editorial-team@simplywallst.com.
