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Paul Taubman has been the CEO of PJT Partners Inc. (NYSE:PJT) since 2015. 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Paul Taubman's Compensation Compare With Similar Sized Companies?
Our data indicates that PJT Partners Inc. is worth US$1.5b, and total annual CEO compensation is US$4.2m. (This number is for the twelve months until December 2018). 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$1.0b to US$3.2b, and the median CEO total compensation was US$4.0m.
So Paul Taubman is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
You can see, below, how CEO compensation at Partners has changed over time.
Is PJT Partners Inc. Growing?
Over the last three years PJT Partners Inc. has shrunk its earnings per share by an average of 24% per year (measured with a line of best fit). Its revenue is up 12% over last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.
Has PJT Partners Inc. Been A Good Investment?
Most shareholders would probably be pleased with PJT Partners Inc. for providing a total return of 48% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Paul Taubman is paid around what is normal the leaders of comparable size companies.
We're not seeing great strides in earnings per share, but the company has clearly pleased some investors, given the returns over the last three years. So we doubt many are complaining about the fairly normal CEO pay. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Partners (free visualization of insider trades).
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 firstname.lastname@example.org. 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.