Mike Schall became the CEO of Essex Property Trust, Inc. (NYSE:ESS) in 2011. First, this article will compare CEO compensation with compensation at other large companies. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Mike Schall's Compensation Compare With Similar Sized Companies?
According to our data, Essex Property Trust, Inc. has a market capitalization of US$22b, and pays its CEO total annual compensation worth US$5.4m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$800k. When we examined a group of companies with market caps over US$8.0b, we found that their median CEO total compensation was US$11m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).
A first glance this seems like a real positive for shareholders, since Mike Schall is paid less than the average total compensation paid by other large companies. Though positive, it's important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at Essex Property Trust has changed from year to year.
Is Essex Property Trust, Inc. Growing?
Over the last three years Essex Property Trust, Inc. has grown its earnings per share (EPS) by an average of 2.4% per year (using a line of best fit). Revenue was pretty flat on last year.
I would argue that the improvement in revenue isn't particularly impressive, but it is good to see modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. It could be important to check this free visual depiction of what analysts expect for the future.
Has Essex Property Trust, Inc. Been A Good Investment?
Boasting a total shareholder return of 55% over three years, Essex Property Trust, Inc. has done well by shareholders. 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.
It looks like Essex Property Trust, Inc. pays its CEO less than the average at large companies.
It's well worth noting that while Mike Schall is paid below what is normal at large companies, the returns have been very pleasing, over the last three years. We would like to see EPS growth, but in our view it seems the CEO is modestly remunerated. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Essex Property Trust (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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