Tom Ferguson has been the CEO of AZZ Inc. (NYSE:AZZ) since 2013. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. 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 Tom Ferguson's Compensation Compare With Similar Sized Companies?
Our data indicates that AZZ Inc. is worth US$1.2b, and total annual CEO compensation is US$2.8m. (This is based on the year to February 2019). That's a notable increase of 62% on last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$725k. We examined companies with market caps from US$1.0b to US$3.2b, and discovered that the median CEO total compensation of that group was US$3.9m.
So Tom Ferguson is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
You can see, below, how CEO compensation at AZZ has changed over time.
Is AZZ Inc. Growing?
On average over the last three years, AZZ Inc. has shrunk earnings per share by 10% each year (measured with a line of best fit). It achieved revenue growth of 10.0% over the last year.
Unfortunately, earnings per share have trended lower over the last three years. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.
Has AZZ Inc. Been A Good Investment?
With a three year total loss of 23%, AZZ Inc. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Tom Ferguson is paid around the same as most CEOs of similar size companies.
Returns have been disappointing and the company is not growing its earnings per share. This doesn't look great when you consider CEO remuneration is up on last year. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at AZZ.
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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