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Albert Behler became the CEO of Paramount Group, Inc. (NYSE:PGRE) in 2014. 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 – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Albert Behler’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Paramount Group, Inc. has a market cap of US$3.8b, and is paying total annual CEO compensation of US$10m. (This is based on the year to 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$1.1m. We examined companies with market caps from US$2.0b to US$6.4b, and discovered that the median CEO compensation of that group was US$4.8m.
Thus we can conclude that Albert Behler receives more in total compensation than the median of a group of companies in the same market, and of similar size to Paramount Group, Inc.. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Paramount Group, below.
Is Paramount Group, Inc. Growing?
Over the last three years Paramount Group, Inc. has grown its earnings per share (EPS) by an average of 29% per year (using a line of best fit). Its revenue is up 4.6% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions. Shareholders might be interested in this free visualization of analyst forecasts.
Has Paramount Group, Inc. Been A Good Investment?
With a total shareholder return of 7.1% over three years, Paramount Group, Inc. has done okay by shareholders. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared the total CEO remuneration paid by Paramount Group, Inc., and compared it to remuneration at a group of similar sized companies. 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. We also think investors are doing ok, over the same time period. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn’t call the CEO pay problematic. Whatever your view on compensation, you might want to check if insiders are buying or selling Paramount Group shares (free trial).
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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.