In 1994 Bill Furman was appointed CEO of The Greenbrier Companies Inc (NYSE:GBX). 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 – 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 Bill Furman’s Compensation Compare With Similar Sized Companies?
Our data indicates that The Greenbrier Companies Inc is worth US$1.5b, and total annual CEO compensation is US$6.2m. That’s less than last year. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$1.0b to US$3.2b. The median total CEO compensation was US$3.5m.
It would therefore appear that The Greenbrier Companies Inc pays Bill Furman more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Greenbrier Companies has changed from year to year.
Is The Greenbrier Companies Inc Growing?
Over the last three years The Greenbrier Companies Inc has shrunk its earnings per share by an average of 21% per year. It achieved revenue growth of 16% over the last year.
Sadly for shareholders, earnings per share are actually down, over three years. And while it’s good to see some good revenue growth recently, the growth isn’t really fast enough for me to put aside my concerns around earnings. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.
You might want to check this free visual report on analyst forecasts for future earnings.
Has The Greenbrier Companies Inc Been A Good Investment?
Most shareholders would probably be pleased with The Greenbrier Companies Inc for providing a total return of 56% over three years. So they may not be at all concerned if the CEO is paid more than is normal for companies around the same size.
We compared the total CEO remuneration paid by The Greenbrier Companies Inc, and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
Earnings per share have not grown in three years, and the revenue growth fails to impress us.
On the other hand, returns have been good, so the company is doing something right. Considering this, shareholders are probably not too worried about the CEO compensation. So you may want to check if insiders are buying The Greenbrier Companies Inc shares with their own money (free access).
Or you might prefer examine intently this intuitive graph showing past earnings and revenue.
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.