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This article will reflect on the compensation paid to Marshall Loeb who has served as CEO of EastGroup Properties, Inc. (NYSE:EGP) since 2016. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for EastGroup Properties.
Comparing EastGroup Properties, Inc.'s CEO Compensation With the industry
Our data indicates that EastGroup Properties, Inc. has a market capitalization of US$4.5b, and total annual CEO compensation was reported as US$4.7m for the year to December 2019. That's a notable increase of 8.6% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$675k.
In comparison with other companies in the industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$5.4m. This suggests that EastGroup Properties remunerates its CEO largely in line with the industry average. Moreover, Marshall Loeb also holds US$5.4m worth of EastGroup Properties stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Talking in terms of the industry, salary represented approximately 15% of total compensation out of all the companies we analyzed, while other remuneration made up 85% of the pie. EastGroup Properties is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at EastGroup Properties, Inc.'s Growth Numbers
EastGroup Properties, Inc.'s earnings per share (EPS) grew 6.9% per year over the last three years. In the last year, its revenue is up 11%.
This revenue growth could really point to a brighter future. And the improvement in earnings per share is modest but respectable. Although we'll stop short of calling the stock a top performer, we think the company has potential. 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 EastGroup Properties, Inc. Been A Good Investment?
Boasting a total shareholder return of 50% over three years, EastGroup Properties, Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
As we noted earlier, EastGroup Properties pays its CEO in line with similar-sized companies belonging to the same industry. But the business isn't reporting great numbers in terms of earnings growth. On the other hand, shareholder returns over the same period have been very healthy. We would like to see EPS growth from the business, although we wouldn't say the CEO compensation is high.
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. That's why we did our research, and identified 4 warning signs for EastGroup Properties (of which 1 is a bit concerning!) that you should know about in order to have a holistic understanding of the stock.
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.
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.
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