Yahoo Finance Here's Why Equifax Inc.'s (NYSE:EFX) CEO Compensation Is The Least Of Shareholders' Concerns
Performance at Equifax Inc. (NYSE:EFX) has been reasonably good and CEO Mark Begor has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 06 May 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. We present our case of why we think CEO compensation looks fair.
View our latest analysis for Equifax
Comparing Equifax Inc.'s CEO Compensation With the industry
At the time of writing, our data shows that Equifax Inc. has a market capitalization of US$29b, and reported total annual CEO compensation of US$14m for the year to December 2020. We note that's a small decrease of 4.1% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.6m.
In comparison with other companies in the industry with market capitalizations over US$8.0b , the reported median total CEO compensation was US$13m. This suggests that Equifax remunerates its CEO largely in line with the industry average. Moreover, Mark Begor also holds US$1.9m worth of Equifax stock directly under their own name.
Component | 2020 | 2019 | Proportion (2020) |
Salary | US$1.6m | US$1.5m | 11% |
Other | US$12m | US$13m | 89% |
Total Compensation | US$14m | US$14m | 100% |
On an industry level, around 21% of total compensation represents salary and 79% is other remuneration. In Equifax's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Equifax Inc.'s Growth Numbers
Equifax Inc.'s earnings per share (EPS) grew 4.4% per year over the last three years. It achieved revenue growth of 21% over the last year.
We think the revenue growth is good. And, while modest, the EPS growth is noticeable. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Equifax Inc. Been A Good Investment?
Boasting a total shareholder return of 109% over three years, Equifax Inc. 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.
In Summary...
Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 2 warning signs for Equifax that investors should be aware of in a dynamic business environment.
Important note: Equifax is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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 (at) simplywallst.com.
