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What Can We Make Of Iron Mountain's (NYSE:IRM) CEO Compensation?

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Simply Wall St
·4 min read
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Bill Meaney has been the CEO of Iron Mountain Incorporated (NYSE:IRM) since 2013, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the funds from operations and shareholder returns of the company.

Check out our latest analysis for Iron Mountain

How Does Total Compensation For Bill Meaney Compare With Other Companies In The Industry?

At the time of writing, our data shows that Iron Mountain Incorporated has a market capitalization of US$8.6b, and reported total annual CEO compensation of US$11m for the year to December 2019. That's a slight decrease of 3.5% on the prior year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.1m.

On comparing similar companies from the same industry with market caps ranging from US$4.0b to US$12b, we found that the median CEO total compensation was US$6.0m. This suggests that Bill Meaney is paid more than the median for the industry. What's more, Bill Meaney holds US$5.6m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2019

2018

Proportion (2019)

Salary

US$1.1m

US$1.1m

10%

Other

US$9.8m

US$10m

90%

Total Compensation

US$11m

US$11m

100%

On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. Iron Mountain sets aside a smaller share of compensation for salary, in comparison to the overall 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

A Look at Iron Mountain Incorporated's Growth Numbers

Over the past three years, Iron Mountain Incorporated has seen its funds from operations (FFO) grow by 3.0% per year. Its revenue is down 1.2% over the previous year.

We would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see a modest FFO growth at least. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Iron Mountain Incorporated Been A Good Investment?

Since shareholders would have lost about 2.8% over three years, some Iron Mountain Incorporated investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

As previously discussed, Bill is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. While we have not been overly impressed by the business performance, the shareholder returns have been utterly depressing, over the last three years. And the situation doesn't look all that good when you see Bill is remunerated higher than the industry average. Taking all this into account, it could be hard to get shareholder support for giving Bill a raise.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 6 warning signs for Iron Mountain (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.

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@simplywallst.com.