Increases to National Fuel Gas Company's (NYSE:NFG) CEO Compensation Might Cool off for now
Key Insights
National Fuel Gas to hold its Annual General Meeting on 8th of March
Salary of US$1.03m is part of CEO Dave Bauer's total remuneration
The total compensation is 120% higher than the average for the industry
National Fuel Gas' EPS grew by 44% over the past three years while total shareholder return over the past three years was 9.8%
CEO Dave Bauer has done a decent job of delivering relatively good performance at National Fuel Gas Company (NYSE:NFG) recently. As shareholders go into the upcoming AGM on 8th of March, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.
Check out our latest analysis for National Fuel Gas
How Does Total Compensation For Dave Bauer Compare With Other Companies In The Industry?
Our data indicates that National Fuel Gas Company has a market capitalization of US$4.5b, and total annual CEO compensation was reported as US$7.8m for the year to September 2023. That's a notable increase of 20% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.0m.
On comparing similar companies from the American Gas Utilities industry with market caps ranging from US$2.0b to US$6.4b, we found that the median CEO total compensation was US$3.5m. Hence, we can conclude that Dave Bauer is remunerated higher than the industry median. What's more, Dave Bauer holds US$4.3m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.0m | US$973k | 13% |
Other | US$6.7m | US$5.5m | 87% |
Total Compensation | US$7.8m | US$6.5m | 100% |
On an industry level, roughly 20% of total compensation represents salary and 80% is other remuneration. It's interesting to note that National Fuel Gas allocates a smaller portion of compensation to salary in comparison 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.
National Fuel Gas Company's Growth
Over the past three years, National Fuel Gas Company has seen its earnings per share (EPS) grow by 44% per year. It saw its revenue drop 11% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has National Fuel Gas Company Been A Good Investment?
National Fuel Gas Company has generated a total shareholder return of 9.8% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.
To Conclude...
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. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.
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 2 warning signs for National Fuel Gas 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.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
