Jay Sugarman became the CEO of iStar Inc (NYSE:STAR) in 1997. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. 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.
How Does Jay Sugarman’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that iStar Inc has a market cap of US$725m, and is paying total annual CEO compensation of US$5.7m. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$1.0m. When we examined a selection of companies with market caps ranging from US$400m to US$1.6b, we found the median CEO compensation was US$2.2m.
It would therefore appear that iStar Inc pays Jay Sugarman 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. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at iStar has changed from year to year.
Is iStar Inc Growing?
On average over the last three years, iStar Inc has grown earnings per share (EPS) by 69% each year. In the last year, its revenue is up 32%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has iStar Inc Been A Good Investment?
With a three year total loss of 13%, iStar Inc would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by iStar Inc, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. On the other hand returns to investors over the same period have probably disappointed many. While EPS is positive, we’d say shareholders would want better returns before the CEO is paid much more. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at iStar.
Or you might prefer this data-rich interactive visualization of historic revenue and earnings.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.