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Is International Game Technology PLC's (NYSE:IGT) CEO Overpaid Relative To Its Peers?

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. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for International Game Technology

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

At the time of writing our data says that International Game Technology PLC has a market cap of US$2.8b, and is paying total annual CEO compensation of US$13m. (This figure is for the year to December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$923k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$2.0b to US$6.4b. The median total CEO compensation was US$4.9m.

It would therefore appear that International Game Technology PLC pays Marco Sala more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

You can see, below, how CEO compensation at International Game Technology has changed over time.

NYSE:IGT CEO Compensation, April 10th 2019

Is International Game Technology PLC Growing?

Over the last three years International Game Technology PLC has shrunk its earnings per share by an average of 49% per year (measured with a line of best fit). It saw its revenue drop -2.2% over the last year.

Sadly for shareholders, earnings per share are actually down, over three years. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.

Has International Game Technology PLC Been A Good Investment?

With a three year total loss of 16%, International Game Technology PLC would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

We compared total CEO remuneration at International Game Technology PLC with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.

Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.

Just as bad, share price gains for investors have failed to materialize, over the same period. Some might well form the view that the CEO is paid too generously! Shareholders may want to check for free if International Game Technology insiders are buying or selling shares.

Important note: International Game Technology may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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.