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Is CubeSmart (NYSE:CUBE) Excessively Paying Its CEO?

Simply Wall St

Chris Marr has been the CEO of CubeSmart (NYSE:CUBE) since 2014. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. 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 CubeSmart

How Does Chris Marr's Compensation Compare With Similar Sized Companies?

According to our data, CubeSmart has a market capitalization of US$6.2b, and paid its CEO total annual compensation worth US$4.1m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$715k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We looked at a group of companies with market capitalizations from US$4.0b to US$12b, and the median CEO total compensation was US$6.9m.

Most shareholders would consider it a positive that Chris Marr takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.

You can see, below, how CEO compensation at CubeSmart has changed over time.

NYSE:CUBE CEO Compensation, October 31st 2019

Is CubeSmart Growing?

On average over the last three years, CubeSmart has grown earnings per share (EPS) by 23% each year (using a line of best fit). It achieved revenue growth of 7.8% over the last year.

This demonstrates that the company has been improving recently. A good result. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Shareholders might be interested in this free visualization of analyst forecasts.

Has CubeSmart Been A Good Investment?

I think that the total shareholder return of 43%, over three years, would leave most CubeSmart shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

CubeSmart is currently paying its CEO below what is normal for companies of its size.

Many would consider this to indicate that the pay is modest since the business is growing. The strong history of shareholder returns might even have some thinking that Chris Marr deserves a raise! It's not often we see shareholders do so well, and yet the CEO is paid modestly. It would be even more positive if company insiders are buying shares. Shareholders may want to check for free if CubeSmart insiders are buying or selling shares.

If you want to buy a stock that is better than CubeSmart, this free list of high return, low debt companies is a great place to look.

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.