In 2008 Keith Smith was appointed CEO of Boyd Gaming Corporation (NYSE:BYD). 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 method should give us information to assess how appropriately the company pays the CEO.
How Does Keith Smith’s Compensation Compare With Similar Sized Companies?
According to our data, Boyd Gaming Corporation has a market capitalization of US$3.2b, and pays its CEO total annual compensation worth US$8.6m. (This is based on the year to December 2017). While we always look at total compensation first, we note that the salary component is less, at US$1.3m. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$4.6m.
As you can see, Keith Smith is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Boyd Gaming Corporation is paying too much. 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 Boyd Gaming has changed from year to year.
Is Boyd Gaming Corporation Growing?
Boyd Gaming Corporation has increased its earnings per share (EPS) by an average of 31% a year, over the last three years (using a line of best fit). It achieved revenue growth of 9.4% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. It could be important to check this free visual depiction of what analysts expect for the future.
Has Boyd Gaming Corporation Been A Good Investment?
I think that the total shareholder return of 54%, over three years, would leave most Boyd Gaming Corporation shareholders smiling. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.
We compared total CEO remuneration at Boyd Gaming Corporation with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong over three years. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Boyd Gaming.
If you want to buy a stock that is better than Boyd Gaming, this free list of high return, low debt companies is a great place to look.
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.