This article will reflect on the compensation paid to Jeffrey Badgley who has served as CEO of Miller Industries, Inc. (NYSE:MLR) since 2013. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Miller Industries.
Comparing Miller Industries, Inc.'s CEO Compensation With the industry
At the time of writing, our data shows that Miller Industries, Inc. has a market capitalization of US$351m, and reported total annual CEO compensation of US$930k for the year to December 2019. We note that's an increase of 18% above last year. In particular, the salary of US$489.3k, makes up a huge portion of the total compensation being paid to the CEO.
On comparing similar companies from the same industry with market caps ranging from US$200m to US$800m, we found that the median CEO total compensation was US$3.1m. In other words, Miller Industries pays its CEO lower than the industry median.
On an industry level, around 16% of total compensation represents salary and 84% is other remuneration. Miller Industries pays out 53% of remuneration in the form of a salary, significantly higher than the industry average. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
A Look at Miller Industries, Inc.'s Growth Numbers
Over the past three years, Miller Industries, Inc. has seen its earnings per share (EPS) grow by 17% per year. In the last year, its revenue is down 12%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Miller Industries, Inc. Been A Good Investment?
Miller Industries, Inc. has generated a total shareholder return of 17% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
As we touched on above, Miller Industries, Inc. is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But over the last three years, EPS growth has been growing rapidly, which is a great sign for the company. Unfortunately, although shareholder returns are growing, they haven't impressed us as much in comparison, over the same period. Shareholder returns could be better but we're pleased with the positive EPS growth. So considering these factors, we think Jeffrey is modestly compensated.
Shareholders may want to check for free if Miller Industries insiders are buying or selling shares.
Important note: Miller Industries 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.
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. 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.
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