Tom Salmon became the CEO of Berry Global Group, Inc. (NYSE:BERY) in 2017, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Berry Global Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Comparing Berry Global Group, Inc.'s CEO Compensation With the industry
According to our data, Berry Global Group, Inc. has a market capitalization of US$7.6b, and paid its CEO total annual compensation worth US$10m over the year to September 2020. Notably, that's an increase of 80% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.1m.
For comparison, other companies in the same industry with market capitalizations ranging between US$4.0b and US$12b had a median total CEO compensation of US$9.6m. From this we gather that Tom Salmon is paid around the median for CEOs in the industry. Moreover, Tom Salmon also holds US$2.6m worth of Berry Global Group stock directly under their own name.
Speaking on an industry level, nearly 13% of total compensation represents salary, while the remainder of 87% is other remuneration. Berry Global Group pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
Berry Global Group, Inc.'s Growth
Berry Global Group, Inc.'s earnings per share (EPS) grew 12% per year over the last three years. Its revenue is up 23% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 Berry Global Group, Inc. Been A Good Investment?
Berry Global Group, Inc. has not done too badly by shareholders, with a total return of 3.8%, over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
As previously discussed, Tom is compensated close to the median for companies of its size, and which belong to the same industry. However, it's admirable that over the last three years, EPS growth for the company has been impressive, though the same can't be said for investor returns. As a result of these considerations, we would suggest the compensation is reasonable, but looking ahead shareholders will likely want to see healthier returns.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Berry Global Group that you should be aware of before investing.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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