Randall Stuewe has been the CEO of Darling Ingredients Inc. (NYSE:DAR) since 2003. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
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How Does Randall Stuewe’s Compensation Compare With Similar Sized Companies?
Our data indicates that Darling Ingredients Inc. is worth US$3.5b, and total annual CEO compensation is US$6.4m. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$1.1m. 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$4.9m.
It would therefore appear that Darling Ingredients Inc. pays Randall Stuewe more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Darling Ingredients, below.
Is Darling Ingredients Inc. Growing?
Over the last three years Darling Ingredients Inc. has grown its earnings per share (EPS) by an average of 29% per year (using a line of best fit). Its revenue is down -2.9% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. Revenue growth is a real positive for growth, but ultimately profits are more important.
You might want to check this free visual report on analyst forecasts for future earnings.
Has Darling Ingredients Inc. Been A Good Investment?
Most shareholders would probably be pleased with Darling Ingredients Inc. for providing a total return of 136% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
We examined the amount Darling Ingredients Inc. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. In addition, shareholders have done well over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling Darling Ingredients shares (free trial).
Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.
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 email@example.com.