Greg Scott has been the CEO of RTW Retailwinds, Inc. (NYSE:RTW) since 2011. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Greg Scott's Compensation Compare With Similar Sized Companies?
Our data indicates that RTW Retailwinds, Inc. is worth US$92m, and total annual CEO compensation was reported as US$3.5m for the year to February 2019. We think total compensation is more important but we note that the CEO salary is lower, at US$900k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$506k.
It would therefore appear that RTW Retailwinds, Inc. pays Greg Scott 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.
The graphic below shows how CEO compensation at RTW Retailwinds has changed from year to year.
Is RTW Retailwinds, Inc. Growing?
RTW Retailwinds, Inc. has increased its earnings per share (EPS) by an average of 57% a year, over the last three years (using a line of best fit). Its revenue is down 7.2% over last year.
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 you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has RTW Retailwinds, Inc. Been A Good Investment?
Given the total loss of 35% over three years, many shareholders in RTW Retailwinds, Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by RTW Retailwinds, Inc., and compared it to remuneration at a group of 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. However, the returns to investors are far less impressive, over the same period. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling RTW Retailwinds (free visualization of insider trades).
Important note: RTW Retailwinds may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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 firstname.lastname@example.org. 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.