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How Should Investors React To Easterly Government Properties, Inc.'s (NYSE:DEA) CEO Pay?

Simply Wall St

William Trimble has been the CEO of Easterly Government Properties, Inc. (NYSE:DEA) since 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Easterly Government Properties

How Does William Trimble's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Easterly Government Properties, Inc. has a market cap of US$1.8b, and reported total annual CEO compensation of US$2.5m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$525k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. When we examined a selection of companies with market caps ranging from US$1.0b to US$3.2b, we found the median CEO total compensation was US$4.0m.

This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. Though positive, it's important we delve into the performance of the actual business.

You can see a visual representation of the CEO compensation at Easterly Government Properties, below.

NYSE:DEA CEO Compensation, November 7th 2019

Is Easterly Government Properties, Inc. Growing?

Easterly Government Properties, Inc. has reduced its earnings per share by an average of 4.2% a year, over the last three years (measured with a line of best fit). Its revenue is up 33% over last year.

Investors should note that, over three years, earnings per share are down. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. It could be important to check this free visual depiction of what analysts expect for the future.

Has Easterly Government Properties, Inc. Been A Good Investment?

Most shareholders would probably be pleased with Easterly Government Properties, Inc. for providing a total return of 43% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Easterly Government Properties, Inc. is currently paying its CEO below what is normal for companies of its size.

William Trimble receives relatively low remuneration compared to similar sized companies. And the returns to shareholders were great, over the last few years. So, while it might be nice to have better EPS growth, on our analysis the CEO compensation is quite modest. So you may want to check if insiders are buying Easterly Government Properties 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.