John Scannell became the CEO of Moog Inc. (NYSE:MOG.A) in 2011. 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does John Scannell's Compensation Compare With Similar Sized Companies?
Our data indicates that Moog Inc. is worth US$2.8b, and total annual CEO compensation was reported as US$3.3m for the year to September 2018. While we always look at total compensation first, we note that the salary component is less, at US$917k. 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$2.0b to US$6.4b, and the median CEO total compensation was US$5.1m.
Most shareholders would consider it a positive that John Scannell takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Moog has changed over time.
Is Moog Inc. Growing?
Over the last three years Moog Inc. has grown its earnings per share (EPS) by an average of 6.7% per year (using a line of best fit). In the last year, its revenue is up 6.9%.
I'm not particularly impressed by the revenue growth, but I'm happy with the modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing. Shareholders might be interested in this free visualization of analyst forecasts.
Has Moog Inc. Been A Good Investment?
Most shareholders would probably be pleased with Moog Inc. for providing a total return of 36% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
It appears that Moog Inc. remunerates its CEO below most similar sized companies.
It's well worth noting that while John Scannell is paid below what is normal at companies of similar size, the returns have been very pleasing, over the last three years. Although we could see higher growth, we'd argue the remuneration is modest, based on these observations. So you may want to check if insiders are buying Moog shares with their own money (free access).
If you want to buy a stock that is better than Moog, this free list of high return, low debt companies is a great place to look.
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