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Increases to CEO Compensation Might Be Put On Hold For Now at Linde plc (NYSE:LIN)

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·3 min read
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Performance at Linde plc (NYSE:LIN) has been reasonably good and CEO Steve Angel has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 26 July 2021. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for Linde

Comparing Linde plc's CEO Compensation With the industry

According to our data, Linde plc has a market capitalization of US$147b, and paid its CEO total annual compensation worth US$19m over the year to December 2020. That's a notable decrease of 17% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.5m.

In comparison with other companies in the industry with market capitalizations over US$8.0b , the reported median total CEO compensation was US$12m. Hence, we can conclude that Steve Angel is remunerated higher than the industry median. What's more, Steve Angel holds US$141m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2020

2019

Proportion (2020)

Salary

US$1.5m

US$1.5m

8%

Other

US$17m

US$21m

92%

Total Compensation

US$19m

US$22m

100%

On an industry level, roughly 17% of total compensation represents salary and 83% is other remuneration. Linde pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ceo-compensation
ceo-compensation

Linde plc's Growth

Over the past three years, Linde plc has seen its earnings per share (EPS) grow by 6.4% per year. Revenue was pretty flat on last year.

We generally like to see a little revenue growth, but the modest EPS growth gives us some relief. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Linde plc Been A Good Investment?

Most shareholders would probably be pleased with Linde plc for providing a total return of 84% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Linde that you should be aware of before investing.

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.

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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.