Mark Steinert became the CEO of Stockland (ASX:SGP) in 2013. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Mark Steinert's Compensation Compare With Similar Sized Companies?
Our data indicates that Stockland is worth AU$11b, and total annual CEO compensation is AU$4.4m. (This is based on the year to June 2018). While we always look at total compensation first, we note that the salary component is less, at AU$1.5m. When we examined a selection of companies with market caps ranging from AU$5.9b to AU$18b, we found the median CEO total compensation was AU$4.1m.
That means Mark Steinert receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
You can see a visual representation of the CEO compensation at Stockland, below.
Is Stockland Growing?
Over the last three years Stockland has shrunk its earnings per share by an average of 5.3% per year (measured with a line of best fit). It saw its revenue drop -11% over the last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. This is compounded by the fact revenue is actually down on last year. 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 Stockland Been A Good Investment?
Stockland has generated a total shareholder return of 14% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
Mark Steinert is paid around the same as most CEOs of similar size companies.
We feel that earnings per share have been a bit disappointing, but and we don't think the total returns are amazing. We do not think the CEO pay is a problem, but we'd venture the company should look to improve its business metrics (and share price) before paying any more. Whatever your view on compensation, you might want to check if insiders are buying or selling Stockland shares (free trial).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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.