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In 2015 Robin Hayes was appointed CEO of JetBlue Airways Corporation (NASDAQ:JBLU). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Robin Hayes's Compensation Compare With Similar Sized Companies?
Our data indicates that JetBlue Airways Corporation is worth US$5.5b, and total annual CEO compensation is US$3.6m. (This is based on the year to December 2018). That's a modest increase of 7.3% on the prior year year. While we always look at total compensation first, we note that the salary component is less, at US$579k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12b. The median total CEO compensation was US$6.8m.
Most shareholders would consider it a positive that Robin Hayes takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it's important we delve into the performance of the actual business.
You can see a visual representation of the CEO compensation at JetBlue Airways, below.
Is JetBlue Airways Corporation Growing?
Over the last three years JetBlue Airways Corporation has shrunk its earnings per share by an average of 17% per year (measured with a line of best fit). Its revenue is up 8.5% over last year.
Unfortunately, earnings per share have trended lower over the last three years. The fairly low revenue growth fails to impress given that the earnings per share is down. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.
Has JetBlue Airways Corporation Been A Good Investment?
With a total shareholder return of 1.5% over three years, JetBlue Airways Corporation has done okay by shareholders. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
It looks like JetBlue Airways Corporation pays its CEO less than similar sized companies.
Robin Hayes is remunerated more modestly than is a normal at similar sized companies. But the business isn't growing earnings per share, and the returns to shareholders haven't been wonderful. So while shareholders shouldn't be overly concerned about CEO compensation, we suspect most would prefer see improved performance, before increasing pay. So you may want to check if insiders are buying JetBlue Airways shares with their own money (free access).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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.