Yahoo Finance Is Dick’s Sporting Goods, Inc.’s (NYSE:DKS) CEO Being Overpaid?
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Ed Stack has been the CEO of Dick’s Sporting Goods, Inc. (NYSE:DKS) since 1984. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. 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.
See our latest analysis for Dick’s Sporting Goods
How Does Ed Stack’s Compensation Compare With Similar Sized Companies?
According to our data, Dick’s Sporting Goods, Inc. has a market capitalization of US$3.7b, and pays its CEO total annual compensation worth US$10m. (This figure is for the year to 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$1.0m. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO compensation was US$4.7m.
Thus we can conclude that Ed Stack receives more in total compensation than the median of a group of companies in the same market, and of similar size to Dick’s Sporting Goods, Inc.. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at Dick’s Sporting Goods has changed over time.
Is Dick’s Sporting Goods, Inc. Growing?
Over the last three years Dick’s Sporting Goods, Inc. has grown its earnings per share (EPS) by an average of 3.7% per year (using a line of best fit). It achieved revenue growth of 2.2% over the last year.
I would argue that the improvement in revenue isn’t particularly impressive, but I’m happy with the modest EPS growth. Considering these factors I’d say performance has been pretty decent, though not amazing. You might want to check this free visual report on analyst forecasts for future earnings.
Has Dick’s Sporting Goods, Inc. Been A Good Investment?
Dick’s Sporting Goods, Inc. has not done too badly by shareholders, with a total return of 0.7%, over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary…
We compared total CEO remuneration at Dick’s Sporting Goods, 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. Shareholders may want to check for free if Dick’s Sporting Goods insiders are buying or selling shares.
If you want to buy a stock that is better than Dick’s Sporting Goods, this free list of high return, low debt companies is a great place to look.
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. On rare occasion, data errors may occur. Thank you for reading.