Yahoo Finance Is Shaftesbury PLC's (LON:SHB) CEO Pay Fair?
Brian Bickell has been the CEO of Shaftesbury PLC (LON:SHB) since 2011. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Shaftesbury
How Does Brian Bickell's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Shaftesbury PLC has a market cap of UK£2.8b, and reported total annual CEO compensation of UK£1.1m for the year to September 2019. That's below the compensation, last year. While we always look at total compensation first, we note that the salary component is less, at UK£508k. When we examined a selection of companies with market caps ranging from UK£1.5b to UK£4.9b, we found the median CEO total compensation was UK£1.7m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
The graphic below shows how CEO compensation at Shaftesbury has changed from year to year.
Is Shaftesbury PLC Growing?
Over the last three years Shaftesbury PLC has shrunk its earnings per share by an average of 20% per year (measured with a line of best fit). Its revenue is up 3.9% over last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. The fairly low revenue growth fails to impress given that the earnings per share is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.
Has Shaftesbury PLC Been A Good Investment?
Shaftesbury PLC has generated a total shareholder return of 11% 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...
It looks like Shaftesbury PLC pays its CEO less than similar sized companies.
Brian Bickell is remunerated more modestly than is a normal at similar sized companies. But the business isn't growing earnings per share, and the returns to shareholders haven't been wonderful. There is room for improved company performance, but we don't see the CEO pay as a big issue here. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Shaftesbury (free visualization of insider trades).
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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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