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How Much Is Callon Petroleum Company (NYSE:CPE) CEO Getting Paid?

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Simply Wall St
·4 min read
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Joe Gatto became the CEO of Callon Petroleum Company (NYSE:CPE) in 2017, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Callon Petroleum

How Does Total Compensation For Joe Gatto Compare With Other Companies In The Industry?

At the time of writing, our data shows that Callon Petroleum Company has a market capitalization of US$449m, and reported total annual CEO compensation of US$7.0m for the year to December 2019. Notably, that's an increase of 17% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$796k.

For comparison, other companies in the same industry with market capitalizations ranging between US$200m and US$800m had a median total CEO compensation of US$4.4m. This suggests that Joe Gatto is paid more than the median for the industry. Furthermore, Joe Gatto directly owns US$582k worth of shares in the company.

Component

2019

2018

Proportion (2019)

Salary

US$796k

US$666k

11%

Other

US$6.2m

US$5.3m

89%

Total Compensation

US$7.0m

US$6.0m

100%

Talking in terms of the industry, salary represented approximately 19% of total compensation out of all the companies we analyzed, while other remuneration made up 81% of the pie. Callon Petroleum pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
ceo-compensation

Callon Petroleum Company's Growth

Over the past three years, Callon Petroleum Company has seen its earnings per share (EPS) grow by 32% per year. It achieved revenue growth of 32% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Callon Petroleum Company Been A Good Investment?

Since shareholders would have lost about 89% over three years, some Callon Petroleum Company investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As we touched on above, Callon Petroleum Company is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But the company has impressed with its earnings per share growth, but we cannot say the same about the uninspiring shareholder returns (over the last three years). Considering overall performance, we can't say Joe is underpaid, in fact compensation is definitely on the higher side.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 4 warning signs for Callon Petroleum you should be aware of, and 3 of them can't be ignored.

Switching gears from Callon Petroleum, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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.