In 2015 Mike Renna was appointed CEO of South Jersey Industries, Inc. (NYSE:SJI). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Mike Renna's Compensation Compare With Similar Sized Companies?
Our data indicates that South Jersey Industries, Inc. is worth US$2.9b, and total annual CEO compensation is US$4.7m. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$748k. 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.
That means Mike Renna receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at South Jersey Industries has changed from year to year.
Is South Jersey Industries, Inc. Growing?
South Jersey Industries, Inc. has reduced its earnings per share by an average of 84% a year, over the last three years (measured with a line of best fit). It achieved revenue growth of 31% over the last year.
Investors should note that, over three years, earnings per share are down. On the other hand, the strong revenue growth suggests the business is growing. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. It could be important to check this free visual depiction of what analysts expect for the future.
Has South Jersey Industries, Inc. Been A Good Investment?
South Jersey Industries, Inc. has served shareholders reasonably well, with a total return of 12% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
Mike Renna is paid around the same as most CEOs of similar size companies.
We see room for improved growth, as well as fairly unremarkable returns over the last three years. But we don't think the CEO compensation is a problem. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling South Jersey Industries (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 email@example.com. 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.