How Much Does NACCO Industries' (NYSE:NC) CEO Make?

This article will reflect on the compensation paid to John Butler who has served as CEO of NACCO Industries, Inc. (NYSE:NC) since 2017. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for NACCO Industries.

View our latest analysis for NACCO Industries

Comparing NACCO Industries, Inc.'s CEO Compensation With the industry

Our data indicates that NACCO Industries, Inc. has a market capitalization of US$137m, and total annual CEO compensation was reported as US$3.7m for the year to December 2019. We note that's an increase of 11% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$709k.

For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$680k. This suggests that John Butler is paid more than the median for the industry. Furthermore, John Butler directly owns US$4.5m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 16% of total compensation out of all the companies we analyzed, while other remuneration made up 84% of the pie. According to our research, NACCO Industries has allocated a higher percentage of pay to salary in comparison to the wider industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at NACCO Industries, Inc.'s Growth Numbers

Over the last three years, NACCO Industries, Inc. has shrunk its earnings per share by 7.4% per year. It saw its revenue drop 13% over the last year.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has NACCO Industries, Inc. Been A Good Investment?

With a three year total loss of 48% for the shareholders, NACCO Industries, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

In Summary...

As we noted earlier, NACCO Industries pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. What's equally worrying is that the company isn't growing by our analysis. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 2 warning signs for NACCO Industries (1 is a bit unpleasant!) that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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