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Does Terreno Realty Corporation's (NYSE:TRNO) CEO Salary Reflect Performance?

Simply Wall St

W. Baird became the CEO of Terreno Realty Corporation (NYSE:TRNO) in 2010. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

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Check out our latest analysis for Terreno Realty

How Does W. Baird's Compensation Compare With Similar Sized Companies?

Our data indicates that Terreno Realty Corporation is worth US$2.9b, and total annual CEO compensation is US$2.1m. (This figure is for the year to December 2018). Notably, that's an increase of 35% over the year before. While we always look at total compensation first, we note that the salary component is less, at US$791k. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$5.3m.

Most shareholders would consider it a positive that W. Baird 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 a visual representation of the CEO compensation at Terreno Realty, below.

NYSE:TRNO CEO Compensation, May 22nd 2019

Is Terreno Realty Corporation Growing?

Terreno Realty Corporation has increased its earnings per share (EPS) by an average of 50% a year, over the last three years (using a line of best fit). It achieved revenue growth of 13% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Terreno Realty Corporation Been A Good Investment?

I think that the total shareholder return of 109%, over three years, would leave most Terreno Realty Corporation shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

It looks like Terreno Realty Corporation pays its CEO less than similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. The strong history of shareholder returns might even have some thinking that W. Baird deserves a raise!

It's not often we see shareholders do so well, and yet the CEO is paid modestly. The cherry on top would be if company insiders are buying shares with their own money. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Terreno Realty.

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 editorial-team@simplywallst.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.