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In 2014 Carlin Conner was appointed CEO of SemGroup Corporation (NYSE:SEMG). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. 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 Carlin Conner's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that SemGroup Corporation has a market cap of US$1.2b, and is paying total annual CEO compensation of US$2.9m. (This number is for the twelve months until December 2017). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$596k. 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$3.6m.
So Carlin Conner is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at SemGroup has changed over time.
Is SemGroup Corporation Growing?
Over the last three years SemGroup Corporation has shrunk its earnings per share by an average of 114% per year (measured with a line of best fit). In the last year, its revenue is up 20%.
Sadly for shareholders, earnings per share are actually down, over three years. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.
Has SemGroup Corporation Been A Good Investment?
Since shareholders would have lost about 26% over three years, some SemGroup Corporation shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
Carlin Conner is paid around what is normal the leaders of comparable size companies.
Returns have been disappointing and the company is not growing its earnings per share. Suffice it to say, we don't think the CEO is underpaid! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling SemGroup (free visualization of insider trades).
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
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. Thank you for reading.