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How Does Coca-Cola Consolidated's (NASDAQ:COKE) CEO Salary Compare to Peers?

Simply Wall St
·4 min read

J. Harrison has been the CEO of Coca-Cola Consolidated, Inc. (NASDAQ:COKE) since 1994, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Coca-Cola Consolidated.

Check out our latest analysis for Coca-Cola Consolidated

How Does Total Compensation For J. Harrison Compare With Other Companies In The Industry?

According to our data, Coca-Cola Consolidated, Inc. has a market capitalization of US$2.2b, and paid its CEO total annual compensation worth US$12m over the year to December 2019. That's mostly flat as compared to the prior year's compensation. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.

On comparing similar companies from the same industry with market caps ranging from US$1.0b to US$3.2b, we found that the median CEO total compensation was US$777k. Accordingly, our analysis reveals that Coca-Cola Consolidated, Inc. pays J. Harrison north of the industry median. Moreover, J. Harrison also holds US$497m worth of Coca-Cola Consolidated stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component

2019

2018

Proportion (2019)

Salary

US$1.2m

US$1.1m

10%

Other

US$11m

US$10m

90%

Total Compensation

US$12m

US$12m

100%

On an industry level, roughly 19% of total compensation represents salary and 81% is other remuneration. Coca-Cola Consolidated sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
ceo-compensation

A Look at Coca-Cola Consolidated, Inc.'s Growth Numbers

Coca-Cola Consolidated, Inc. has seen its earnings per share (EPS) increase by 7.4% a year over the past three years. It achieved revenue growth of 2.8% over the last year.

We'd prefer higher revenue growth, but it is good to see modest EPS growth. Considering these factors we'd say performance has been pretty decent, though not amazing. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Coca-Cola Consolidated, Inc. Been A Good Investment?

With a total shareholder return of 14% over three years, Coca-Cola Consolidated, Inc. shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

As we noted earlier, Coca-Cola Consolidated pays its CEO higher than the norm for similar-sized companies belonging to the same industry. But the company lacks EPS growth, and returns to shareholders are less than stellar, over the last three years. Overall, although the company has delivered steady performance, we would like to see an improvement in key metrics before we can say the high CEO compensation is justified.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 3 warning signs for Coca-Cola Consolidated you should be aware of, and 1 of them is a bit concerning.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.