Mark Decker became the CEO of Investors Real Estate Trust (NYSE:IRET) 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 look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Investors Real Estate Trust.
How Does Total Compensation For Mark Decker Compare With Other Companies In The Industry?
According to our data, Investors Real Estate Trust has a market capitalization of US$924m, and paid its CEO total annual compensation worth US$1.6m over the year to December 2019. We note that's an increase of 29% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$465k.
In comparison with other companies in the industry with market capitalizations ranging from US$400m to US$1.6b, the reported median CEO total compensation was US$4.1m. This suggests that Mark Decker is paid below the industry median. What's more, Mark Decker holds US$2.0m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. According to our research, Investors Real Estate Trust has allocated a higher percentage of pay to salary in comparison to the wider industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at Investors Real Estate Trust's Growth Numbers
Investors Real Estate Trust's earnings per share (EPS) grew 103% per year over the last three years. The trailing twelve months of revenue was pretty much the same as the prior period.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Investors Real Estate Trust Been A Good Investment?
Investors Real Estate Trust has served shareholders reasonably well, with a total return of 30% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
As previously discussed, Mark is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. At the same time, earnings growth has been exceptional over the past three years. Shareholder returns, in comparison, have not been as impressive. Shareholder returns could be better but we're pleased with the positive EPS growth. As a result of these considerations, CEO compensation seems quite appropriate.
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. In our study, we found 4 warning signs for Investors Real Estate Trust you should be aware of, and 2 of them are potentially serious.
Switching gears from Investors Real Estate Trust, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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