Mark Mondello has been the CEO of Jabil Inc (NYSE:JBL) since 2013. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Mark Mondello’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Jabil Inc has a market cap of US$3.9b, and is paying total annual CEO compensation of US$11m. That’s just a smallish increase of 0.3% on last year. We looked at a group of companies with market capitalizations from US$2.0b to US$6.4b, and the median CEO compensation was US$5.1m.
Thus we can conclude that Mark Mondello receives more in total compensation than the median of a group of companies in the same market, and of similar size to Jabil Inc. However, this doesn’t necessarily mean the pay 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 Jabil has changed from year to year.
Is Jabil Inc Growing?
On average over the last three years, Jabil Inc has shrunk earnings per share by 39% each year. Its revenue is up 16% over last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Jabil Inc Been A Good Investment?
Since shareholders would have lost about 0.5% over three years, some Jabil Inc shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
We examined the amount Jabil Inc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
Over the same period, investors would have come away with nothing in the way of share price gains. This analysis suggests to us that the CEO is paid too generously!
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.