Jay Gould became the CEO of Interface, Inc. (NASDAQ:TILE) in 2017. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Jay Gould's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Interface, Inc. has a market cap of US$758m, and reported total annual CEO compensation of US$5.1m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$927k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. When we examined a selection of companies with market caps ranging from US$400m to US$1.6b, we found the median CEO total compensation was US$2.7m.
It would therefore appear that Interface, Inc. pays Jay Gould 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. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see a visual representation of the CEO compensation at Interface, below.
Is Interface, Inc. Growing?
Over the last three years Interface, Inc. has shrunk its earnings per share by an average of 5.9% per year (measured with a line of best fit). It achieved revenue growth of 25% over the last year.
Investors should note that, over three years, earnings per share are down. But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. You might want to check this free visual report on analyst forecasts for future earnings.
Has Interface, Inc. Been A Good Investment?
Given the total loss of 18% over three years, many shareholders in Interface, Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared total CEO remuneration at Interface, Inc. with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Although we'd stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Interface.
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.
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