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Is International Game Technology PLC's (NYSE:IGT) CEO Pay Fair?

Simply Wall St

Marco Sala became the CEO of International Game Technology PLC (NYSE:IGT) in 2015. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. This process should give us an idea about how appropriately the CEO is paid.

See our latest analysis for International Game Technology

How Does Marco Sala's Compensation Compare With Similar Sized Companies?

According to our data, International Game Technology PLC has a market capitalization of US$2.9b, and paid its CEO total annual compensation worth US$13m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$923k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We examined companies with market caps from US$2.0b to US$6.4b, and discovered that the median CEO total compensation of that group was US$5.1m.

As you can see, Marco Sala is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean International Game Technology PLC is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

The graphic below shows how CEO compensation at International Game Technology has changed from year to year.

NYSE:IGT CEO Compensation, October 16th 2019

Is International Game Technology PLC Growing?

International Game Technology PLC has reduced its earnings per share by an average of 27% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is down 3.5%.

Few shareholders would be pleased to read that earnings per share are lower over three years. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.

Has International Game Technology PLC Been A Good Investment?

With a three year total loss of 42%, International Game Technology PLC would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared the total CEO remuneration paid by International Game Technology PLC, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. Just as bad, share price gains for investors have failed to materialize, over the same period. In our opinion the CEO might be paid too generously! So you may want to check if insiders are buying International Game Technology 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.

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 editorial-team@simplywallst.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.