Key Insights
- Herc Holdings' Annual General Meeting to take place on 15th of May
- CEO Larry Silber's total compensation includes salary of US$1.03m
- The overall pay is comparable to the industry average
- Herc Holdings' EPS declined by 19% over the past three years while total shareholder return over the past three years was 20%
Despite positive share price growth of 20% for Herc Holdings Inc. (NYSE:HRI) over the last few years, earnings growth has been disappointing, which suggests something is amiss. The upcoming AGM on 15th of May may be an opportunity for shareholders to bring up any concerns they may have for the board’s attention. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.
Check out our latest analysis for Herc Holdings
How Does Total Compensation For Larry Silber Compare With Other Companies In The Industry?
According to our data, Herc Holdings Inc. has a market capitalization of US$3.2b, and paid its CEO total annual compensation worth US$6.9m over the year to December 2024. That's a notable increase of 13% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.0m.
For comparison, other companies in the American Trade Distributors industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$6.8m. From this we gather that Larry Silber is paid around the median for CEOs in the industry. Moreover, Larry Silber also holds US$19m worth of Herc Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
| Component | 2024 | 2023 | Proportion (2024) |
| Salary | US$1.0m | US$967k | 15% |
| Other | US$5.9m | US$5.2m | 85% |
| Total Compensation | US$6.9m | US$6.1m | 100% |
On an industry level, around 16% of total compensation represents salary and 84% is other remuneration. Herc Holdings is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Herc Holdings Inc.'s Growth
Herc Holdings Inc. has reduced its earnings per share by 19% a year over the last three years. It achieved revenue growth of 8.3% over the last year.
Few shareholders would be pleased to read that EPS have declined. The fairly low revenue growth fails to impress given that the EPS is down. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Herc Holdings Inc. Been A Good Investment?
Herc Holdings Inc. has generated a total shareholder return of 20% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Shareholder returns, while positive, should be looked at along with earnings, which have not grown at all recently. This makes us think the share price momentum may slow in the future. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for Herc Holdings you should be aware of, and 1 of them doesn't sit too well with us.
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.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.