Rob Vitale became the CEO of Post Holdings, Inc. (NYSE:POST) in 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Rob Vitale's Compensation Compare With Similar Sized Companies?
According to our data, Post Holdings, Inc. has a market capitalization of US$7.6b, and paid its CEO total annual compensation worth US$11m over the year to September 2019. Notably, that's an increase of 15% over the year before. We think total compensation is more important but we note that the CEO salary is lower, at US$1.4m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We examined companies with market caps from US$4.0b to US$12b, and discovered that the median CEO total compensation of that group was US$6.5m.
As you can see, Rob Vitale is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Post Holdings, Inc. is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Post Holdings, below.
Is Post Holdings, Inc. Growing?
On average over the last three years, Post Holdings, Inc. has grown earnings per share (EPS) by 48% each year (using a line of best fit). In the last year, its revenue is down 9.2%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Shareholders might be interested in this free visualization of analyst forecasts.
Has Post Holdings, Inc. Been A Good Investment?
With a total shareholder return of 31% over three years, Post Holdings, 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.
We compared the total CEO remuneration paid by Post Holdings, 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.
Importantly, though, the company has impressed with its earnings per share growth, over three years. We also think investors are doing ok, over the same time period. While it may be worth researching further, we don't see a problem with the CEO pay, given the good EPS growth. Whatever your view on compensation, you might want to check if insiders are buying or selling Post Holdings shares (free trial).
If you want to buy a stock that is better than Post Holdings, this free list of high return, low debt companies is a great place to look.
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.
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