Yahoo Finance Does Vector Group Ltd.'s (NYSE:VGR) CEO Salary Compare Well With Others?
Howard Lorber became the CEO of Vector Group Ltd. (NYSE:VGR) in 2006. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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.
Check out our latest analysis for Vector Group
How Does Howard Lorber's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Vector Group Ltd. has a market cap of US$1.6b, and reported total annual CEO compensation of US$12m for the year to December 2019. That's a notable increase of 38% on last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$3.3m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations from US$1.0b to US$3.2b, and the median CEO total compensation was US$4.9m.
Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Vector Group. On an industry level, roughly 27% of total compensation represents salary and 73% is other remuneration. Vector Group does not set aside a larger portion of remuneration in the form of salary, maintaining the same rate as the wider market.
It would therefore appear that Vector Group Ltd. pays Howard Lorber 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. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. You can see a visual representation of the CEO compensation at Vector Group, below.
Is Vector Group Ltd. Growing?
On average over the last three years, Vector Group Ltd. has seen earnings per share (EPS) move in a favourable direction by 17% each year (using a line of best fit). Its revenue is up 3.7% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. It could be important to check this free visual depiction of what analysts expect for the future.
Has Vector Group Ltd. Been A Good Investment?
Given the total loss of 22% over three years, many shareholders in Vector Group Ltd. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
We examined the amount Vector Group Ltd. pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However, the earnings per share growth over three years is certainly impressive. However, the returns to investors are far less impressive, over the same period. So shareholders might not feel great about the fact that CEO pay increased on last year. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. On another note, Vector Group has 4 warning signs (and 2 which are a bit concerning) we think you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
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