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Is Hyatt Hotels Corporation’s (NYSE:H) CEO Overpaid Relative To Its Peers?

Mark Hoplamazian has been the CEO of Hyatt Hotels Corporation (NYSE:H) since 2006. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for Hyatt Hotels

How Does Mark Hoplamazian’s Compensation Compare With Similar Sized Companies?

According to our data, Hyatt Hotels Corporation has a market capitalization of US$7.6b, and pays its CEO total annual compensation worth US$9.9m. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$1.2m. When we examined a selection of companies with market caps ranging from US$4.0b to US$12b, we found the median CEO compensation was US$6.7m.

Thus we can conclude that Mark Hoplamazian receives more in total compensation than the median of a group of companies in the same market, and of similar size to Hyatt Hotels Corporation. However, this doesn’t necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see a visual representation of the CEO compensation at Hyatt Hotels, below.

NYSE:H CEO Compensation November 28th 18
NYSE:H CEO Compensation November 28th 18

Is Hyatt Hotels Corporation Growing?

Hyatt Hotels Corporation has increased its earnings per share (EPS) by an average of 62% a year, over the last three years It saw its revenue drop -3.3% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. The lack of revenue growth isn’t ideal, but it is the bottom line that counts most in business.

It could be important to check this free visual depiction of what analysts expect for the future.

Has Hyatt Hotels Corporation Been A Good Investment?

Boasting a total shareholder return of 42% over three years, Hyatt Hotels Corporation has done well by shareholders. So they may not be at all concerned if the CEO is paid more than is normal for companies around the same size.

In Summary…

We compared the total CEO remuneration paid by Hyatt Hotels Corporation, 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.

Importantly, though, the company has impressed with its earnings per share growth, over three years. Even better, returns to shareholders have been plentiful, over the same time period. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. So you may want to check if insiders are buying Hyatt Hotels shares with their own money (free access).

Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .

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 editorial-team@simplywallst.com.

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