In 2011 John Roberts was appointed CEO of J.B. Hunt Transport Services, Inc. ( NASDAQ:JBHT ). This analysis aims first to contrast CEO compensation with other large companies. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does John Roberts's Compensation Compare With Similar Sized Companies?
According to our data, J.B. Hunt Transport Services, Inc. has a market capitalization of US$11b, and pays its CEO total annual compensation worth US$6.8m. (This is based on the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$845k. We took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO total compensation to be US$11m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).
Most shareholders would consider it a positive that John Roberts takes less in total compensation than the CEOs of most other large companies, leaving more for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
The graphic below shows how CEO compensation at J.B. Hunt Transport Services has changed from year to year.
Is J.B. Hunt Transport Services, Inc. Growing?
J.B. Hunt Transport Services, Inc. has increased its earnings per share (EPS) by an average of 13% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 12%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has J.B. Hunt Transport Services, Inc. Been A Good Investment?
J.B. Hunt Transport Services, Inc. has generated a total shareholder return of 28% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
J.B. Hunt Transport Services, Inc. is currently paying its CEO below what is normal for large companies. Since the business is growing, many would argue this suggests the pay is modest. While returns over the last few years haven't been top notch, there is nothing to suggest to us that John Roberts is overcompensated.
Few would complain about reasonable CEO remuneration when the business is growing earnings per share. But for me, it's even better if insiders are also buying shares with their own cold, hard, cash. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at J.B. Hunt Transport Services.
Important note: J.B. Hunt Transport Services 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.
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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.