In 2013 Wyman Roberts was appointed CEO of Brinker International, Inc. (NYSE:EAT). 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 Wyman Roberts's Compensation Compare With Similar Sized Companies?
Our data indicates that Brinker International, Inc. is worth US$1.6b, and total annual CEO compensation was reported as US$10.0m for the year to June 2019. That's a notable increase of 46% on last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$1.0m. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. 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$3.9m.
Thus we can conclude that Wyman Roberts receives more in total compensation than the median of a group of companies in the same market, and of similar size to Brinker International, Inc.. However, this doesn't necessarily mean the pay is too high. 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 Brinker International has changed from year to year.
Is Brinker International, Inc. Growing?
Brinker International, Inc. has increased its earnings per share (EPS) by an average of 8.3% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 3.2%.
I would argue that the improvement in revenue isn't particularly impressive, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. Shareholders might be interested in this free visualization of analyst forecasts.
Has Brinker International, Inc. Been A Good Investment?
Given the total loss of 6.8% over three years, many shareholders in Brinker International, Inc. are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We compared total CEO remuneration at Brinker International, Inc. 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.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. So shareholders might not feel great about the fact that CEO pay increased on last year. Although we'd stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. So you may want to check if insiders are buying Brinker International shares with their own money (free access).
Important note: Brinker International may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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.
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