Suzanne Sitherwood became the CEO of Spire Inc. (NYSE:SR) in 2012, 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 evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
How Does Total Compensation For Suzanne Sitherwood Compare With Other Companies In The Industry?
According to our data, Spire Inc. has a market capitalization of US$2.7b, and paid its CEO total annual compensation worth US$4.5m over the year to September 2019. We note that's an increase of 12% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$900k.
For comparison, other companies in the same industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$4.5m. This suggests that Spire remunerates its CEO largely in line with the industry average. What's more, Suzanne Sitherwood holds US$6.4m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Speaking on an industry level, nearly 18% of total compensation represents salary, while the remainder of 82% is other remuneration. Our data reveals that Spire allocates salary more or less in line with the wider market. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Spire Inc.'s Growth Numbers
Over the last three years, Spire Inc. has shrunk its earnings per share by 31% per year. In the last year, its revenue is down 7.0%.
Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Spire Inc. Been A Good Investment?
Since shareholders would have lost about 23% over three years, some Spire Inc. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
As we noted earlier, Spire pays its CEO in line with similar-sized companies belonging to the same industry. In the meantime, the company has reported declining EPS growth and shareholder returns over the last three years. Considering overall performance, shareholders will likely hold off support for a raise until results improve.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 5 warning signs for Spire you should be aware of, and 1 of them makes us a bit uncomfortable.
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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