Yahoo Finance Here's Why Shareholders May Want To Be Cautious With Increasing Clear Channel Outdoor Holdings, Inc.'s (NYSE:CCO) CEO Pay Packet
Key Insights
Clear Channel Outdoor Holdings will host its Annual General Meeting on 16th of May
Salary of US$1.10m is part of CEO Scott Wells's total remuneration
Total compensation is similar to the industry average
Over the past three years, Clear Channel Outdoor Holdings' EPS grew by 73% and over the past three years, the total loss to shareholders 25%
In the past three years, the share price of Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) has struggled to grow and now shareholders are sitting on a loss. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. These are some of the concerns that shareholders may want to bring up at the next AGM held on 16th of May. They could also influence management through voting on resolutions such as executive remuneration. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.
View our latest analysis for Clear Channel Outdoor Holdings
Comparing Clear Channel Outdoor Holdings, Inc.'s CEO Compensation With The Industry
Our data indicates that Clear Channel Outdoor Holdings, Inc. has a market capitalization of US$745m, and total annual CEO compensation was reported as US$4.8m for the year to December 2023. That's a notable decrease of 20% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.1m.
On examining similar-sized companies in the American Media industry with market capitalizations between US$400m and US$1.6b, we discovered that the median CEO total compensation of that group was US$5.6m. So it looks like Clear Channel Outdoor Holdings compensates Scott Wells in line with the median for the industry. Moreover, Scott Wells also holds US$3.5m worth of Clear Channel Outdoor Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.1m | US$1.1m | 23% |
Other | US$3.7m | US$4.9m | 77% |
Total Compensation | US$4.8m | US$6.0m | 100% |
On an industry level, roughly 19% of total compensation represents salary and 81% is other remuneration. Clear Channel Outdoor Holdings is paying a higher share of its remuneration through a salary in comparison to the overall 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 Clear Channel Outdoor Holdings, Inc.'s Growth Numbers
Clear Channel Outdoor Holdings, Inc. has seen its earnings per share (EPS) increase by 73% a year over the past three years. In the last year, its revenue is down 13%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Clear Channel Outdoor Holdings, Inc. Been A Good Investment?
Since shareholders would have lost about 25% over three years, some Clear Channel Outdoor Holdings, Inc. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would be keen to know what's holding the stock back when earnings have grown. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 2 warning signs for Clear Channel Outdoor Holdings you should be aware of, and 1 of them is a bit unpleasant.
Switching gears from Clear Channel Outdoor Holdings, 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.
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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.
