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In 2003 Don Wood was appointed CEO of Federal Realty Investment Trust (NYSE:FRT). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. 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 Don Wood's Compensation Compare With Similar Sized Companies?
According to our data, Federal Realty Investment Trust has a market capitalization of US$10.0b, and pays its CEO total annual compensation worth US$7.5m. (This is based on the year to December 2018). That's actually a decrease on the year before. While we always look at total compensation first, we note that the salary component is less, at US$950k. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO total compensation was US$11m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
This would give shareholders a good impression of the company, since most large companies pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Federal Realty Investment Trust has changed over time.
Is Federal Realty Investment Trust Growing?
On average over the last three years, Federal Realty Investment Trust has shrunk earnings per share by 2.0% each year (measured with a line of best fit). Its revenue is up 5.0% over last year.
In the last three years the company has failed to grow earnings per s. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.
Has Federal Realty Investment Trust Been A Good Investment?
Since shareholders would have lost about 7.9% over three years, some Federal Realty Investment Trust shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
It looks like Federal Realty Investment Trust pays its CEO less than the average at large companies.
The compensation paid to Don Wood is lower than is usual at larger companies, but the eps growth is lacking, just like the returns (over three years). While one could argue it is appropriate for the CEO to be paid less than other CEOs of similar sized companies, given company performance, we would not call the pay overly generous. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Federal Realty Investment Trust (free visualization of insider trades).
If you want to buy a stock that is better than Federal Realty Investment Trust, this free list of high return, low debt companies is a great place to look.
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.