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Jack Remondi became the CEO of Navient Corporation (NASDAQ:NAVI) in 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Jack Remondi's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Navient Corporation has a market cap of US$3.2b, and is paying total annual CEO compensation of US$6.9m. (This is based on the year to December 2018). That's a modest increase of 6.9% on the prior year year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$1.0m. We looked at a group of companies with market capitalizations from US$2.0b to US$6.4b, and the median CEO total compensation was US$5.2m.
Thus we can conclude that Jack Remondi receives more in total compensation than the median of a group of companies in the same market, and of similar size to Navient Corporation. However, this doesn't necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Navient has changed from year to year.
Is Navient Corporation Growing?
On average over the last three years, Navient Corporation has shrunk earnings per share by 26% each year (measured with a line of best fit). In the last year, its revenue is down -18%.
Sadly for shareholders, earnings per share are actually down, over three years. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.
Has Navient Corporation Been A Good Investment?
Navient Corporation has generated a total shareholder return of 33% over three years, so most shareholders would be reasonably content. 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.
We compared the total CEO remuneration paid by Navient Corporation, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
While shareholder returns are acceptable, they don't delight. So we doubt many shareholders would consider the CEO pay to be particularly modest! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Navient.
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 email@example.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.