Yahoo Finance How Is CMS Energy's (NYSE:CMS) CEO Compensated?
This article will reflect on the compensation paid to Patti Poppe who has served as CEO of CMS Energy Corporation (NYSE:CMS) since 2016. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for CMS Energy.
Check out our latest analysis for CMS Energy
How Does Total Compensation For Patti Poppe Compare With Other Companies In The Industry?
Our data indicates that CMS Energy Corporation has a market capitalization of US$19b, and total annual CEO compensation was reported as US$9.0m for the year to December 2019. Notably, that's an increase of 11% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.3m.
For comparison, other companies in the industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$9.3m. From this we gather that Patti Poppe is paid around the median for CEOs in the industry. Furthermore, Patti Poppe directly owns US$30m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$1.3m | US$1.2m | 14% |
Other | US$7.7m | US$6.9m | 86% |
Total Compensation | US$9.0m | US$8.1m | 100% |
On an industry level, roughly 14% of total compensation represents salary and 86% is other remuneration. There isn't a significant difference between CMS Energy and the broader market, in terms of salary allocation in the overall compensation package. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
CMS Energy Corporation's Growth
CMS Energy Corporation's earnings per share (EPS) grew 10% per year over the last three years. Its revenue is down 4.1% over the previous year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has CMS Energy Corporation Been A Good Investment?
Boasting a total shareholder return of 47% over three years, CMS Energy Corporation has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
To Conclude...
As previously discussed, Patti is compensated close to the median for companies of its size, and which belong to the same industry. Few would be critical of the leadership, since returns have been juicy and EPS are moving in the right direction. So one could argue that CEO compensation is quite modest, if you consider company performance! Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.
CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 2 warning signs (and 1 which makes us a bit uncomfortable) in CMS Energy we think you should know about.
Switching gears from CMS Energy, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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. 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.
