Yahoo Finance Is PrimeEnergy Resources Corporation (NASDAQ:PNRG) Overpaying Its CEO?
Charles Drimal has been the CEO of PrimeEnergy Resources Corporation (NASDAQ:PNRG) since 1987. First, this article will compare CEO compensation with compensation at similar sized companies. 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.
See our latest analysis for PrimeEnergy Resources
How Does Charles Drimal's Compensation Compare With Similar Sized Companies?
According to our data, PrimeEnergy Resources Corporation has a market capitalization of US$230m, and pays its CEO total annual compensation worth US$9.3m. (This number is for the twelve months until December 2018). While we always look at total compensation first, we note that the salary component is less, at US$541k. When we examined a selection of companies with market caps ranging from US$100m to US$400m, we found the median CEO total compensation was US$1.2m.
Thus we can conclude that Charles Drimal receives more in total compensation than the median of a group of companies in the same market, and of similar size to PrimeEnergy Resources Corporation. However, this doesn't necessarily mean the pay 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 PrimeEnergy Resources has changed from year to year.
Is PrimeEnergy Resources Corporation Growing?
PrimeEnergy Resources Corporation has increased its earnings per share (EPS) by an average of 32% a year, over the last three years (using a line of best fit). It achieved revenue growth of 7.9% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has PrimeEnergy Resources Corporation Been A Good Investment?
Most shareholders would probably be pleased with PrimeEnergy Resources Corporation for providing a total return of 101% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
We compared total CEO remuneration at PrimeEnergy Resources Corporation with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. Even better, returns to shareholders have been plentiful, over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. Shareholders may want to check for free if PrimeEnergy Resources insiders are buying or selling shares.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity 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 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.
