Yahoo Finance Here's Why Shareholders May Want To Be Cautious With Increasing Haverty Furniture Companies, Inc.'s (NYSE:HVT) CEO Pay Packet
Key Insights
Haverty Furniture Companies to hold its Annual General Meeting on 6th of May
CEO Clarence Smith's total compensation includes salary of US$760.0k
The overall pay is comparable to the industry average
Haverty Furniture Companies' EPS grew by 3.0% over the past three years while total shareholder loss over the past three years was 18%
Shareholders of Haverty Furniture Companies, Inc. (NYSE:HVT) will have been dismayed by the negative share price return over the last three years. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. These are some of the concerns that shareholders may want to bring up at the next AGM held on 6th of May. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.
See our latest analysis for Haverty Furniture Companies
How Does Total Compensation For Clarence Smith Compare With Other Companies In The Industry?
Our data indicates that Haverty Furniture Companies, Inc. has a market capitalization of US$510m, and total annual CEO compensation was reported as US$2.9m for the year to December 2023. That's a modest increase of 7.8% on the prior year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$760k.
For comparison, other companies in the American Specialty Retail industry with market capitalizations ranging between US$200m and US$800m had a median total CEO compensation of US$3.8m. So it looks like Haverty Furniture Companies compensates Clarence Smith in line with the median for the industry. What's more, Clarence Smith holds US$26m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$760k | US$725k | 26% |
Other | US$2.1m | US$2.0m | 74% |
Total Compensation | US$2.9m | US$2.7m | 100% |
Talking in terms of the industry, salary represented approximately 17% of total compensation out of all the companies we analyzed, while other remuneration made up 83% of the pie. According to our research, Haverty Furniture Companies has allocated a higher percentage of pay to salary in comparison to the wider industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at Haverty Furniture Companies, Inc.'s Growth Numbers
Over the past three years, Haverty Furniture Companies, Inc. has seen its earnings per share (EPS) grow by 3.0% per year. It saw its revenue drop 18% over the last year.
We generally like to see a little revenue growth, but the modest EPS growth gives us some relief. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Haverty Furniture Companies, Inc. Been A Good Investment?
With a three year total loss of 18% for the shareholders, Haverty Furniture Companies, Inc. would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Haverty Furniture Companies that investors should think about before committing capital to this stock.
Important note: Haverty Furniture Companies is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
