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Is Apartment Investment and Management Company's (NYSE:AIV) CEO Pay Justified?

Simply Wall St

Terry Considine became the CEO of Apartment Investment and Management Company (NYSE:AIV) in 1994. 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. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

See our latest analysis for Apartment Investment and Management

How Does Terry Considine's Compensation Compare With Similar Sized Companies?

According to our data, Apartment Investment and Management Company has a market capitalization of US$8.2b, and paid its CEO total annual compensation worth US$6.8m over the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$700k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We examined companies with market caps from US$4.0b to US$12b, and discovered that the median CEO total compensation of that group was US$6.5m.

So Terry Considine receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at Apartment Investment and Management has changed over time.

NYSE:AIV CEO Compensation, January 8th 2020

Is Apartment Investment and Management Company Growing?

On average over the last three years, Apartment Investment and Management Company has grown earnings per share (EPS) by 33% each year (using a line of best fit). In the last year, its revenue is down 8.2%.

This demonstrates that the company has been improving recently. A good result. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Apartment Investment and Management Company Been A Good Investment?

Apartment Investment and Management Company has served shareholders reasonably well, with a total return of 28% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Terry Considine is paid around the same as most CEOs of similar size companies.

Shareholder returns could be better but shareholders would be pleased with the positive EPS growth. So considering these factors, we think the CEO pay is probably quite reasonable. So you may want to check if insiders are buying Apartment Investment and Management shares with their own money (free access).

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.