How Should Investors React To Citi Trends, Inc.'s (NASDAQ:CTRN) CEO Pay?
In 2017 Bruce Smith was appointed CEO of Citi Trends, Inc. (NASDAQ:CTRN). 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. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Citi Trends
How Does Bruce Smith's Compensation Compare With Similar Sized Companies?
Our data indicates that Citi Trends, Inc. is worth US$212m, and total annual CEO compensation was reported as US$1.2m for the year to February 2019. We think total compensation is more important but we note that the CEO salary is lower, at US$545k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO total compensation was US$1.2m.
So Bruce Smith receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at Citi Trends has changed over time.
Is Citi Trends, Inc. Growing?
On average over the last three years, Citi Trends, Inc. has grown earnings per share (EPS) by 22% each year (using a line of best fit). In the last year, its revenue is down 2.2%.
This demonstrates that the company has been improving recently. A good result. While it would be good to see revenue growth, profits matter more in the end. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Citi Trends, Inc. Been A Good Investment?
Given the total loss of 4.4% over three years, many shareholders in Citi Trends, Inc. are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
Remuneration for Bruce Smith is close enough to the median pay for a CEO of a similar sized company .
We think that the EPS growth is very pleasing, but we find the returns over the last three years to be lacking. Considering the the positives we don't think the CEO pays is too high, but it's certainly hard to argue it is too low. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Citi Trends (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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. Thank you for reading.
