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Is Capri Holdings Limited's (NYSE:CPRI) CEO Salary Justified?

Simply Wall St

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In 2003 John Idol was appointed CEO of Capri Holdings Limited (NYSE:CPRI). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Capri Holdings

How Does John Idol's Compensation Compare With Similar Sized Companies?

Our data indicates that Capri Holdings Limited is worth US$6.6b, and total annual CEO compensation is US$7.6m. (This number is for the twelve months until March 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$1.0m. 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$6.8m.

So John Idol is paid around the average of 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.

The graphic below shows how CEO compensation at Capri Holdings has changed from year to year.

NYSE:CPRI CEO Compensation, May 3rd 2019

Is Capri Holdings Limited Growing?

On average over the last three years, Capri Holdings Limited has shrunk earnings per share by 6.0% each year (measured with a line of best fit). It achieved revenue growth of 10% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for me to put aside my concerns around earnings. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.

Has Capri Holdings Limited Been A Good Investment?

Since shareholders would have lost about 14% over three years, some Capri Holdings Limited shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

John Idol is paid around the same as most CEOs of similar size companies.

Returns have been disappointing and the company is not growing its earnings per share. Suffice it to say, we don't think the CEO is underpaid! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Capri Holdings.

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.

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.

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. Thank you for reading.