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Don Brandt has been the CEO of Pinnacle West Capital Corporation (NYSE:PNW) since 2009. This analysis aims first to contrast CEO compensation with other large companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Don Brandt's Compensation Compare With Similar Sized Companies?
According to our data, Pinnacle West Capital Corporation has a market capitalization of US$11b, and pays its CEO total annual compensation worth US$12m. (This figure is for the year to December 2018). That's a notable increase of 15% on last year. While we always look at total compensation first, we note that the salary component is less, at US$1.4m. We took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO total compensation to be US$11m. There aren't very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
That means Don Brandt receives fairly typical remuneration for the CEO of a large company. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at Pinnacle West Capital has changed over time.
Is Pinnacle West Capital Corporation Growing?
Pinnacle West Capital Corporation has increased its earnings per share (EPS) by an average of 6.2% a year, over the last three years (using a line of best fit). Its revenue is up 4.4% over last year.
I'm not particularly impressed by the revenue growth, but I'm happy with the modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. You might want to check this free visual report on analyst forecasts for future earnings.
Has Pinnacle West Capital Corporation Been A Good Investment?
Pinnacle West Capital Corporation has served shareholders reasonably well, with a total return of 28% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
Don Brandt is paid around the same as most CEOs of large companies.
The company isn't showing particularly great growth, and shareholder turns haven't been particularly inspiring in the last few years. While the CEO may not be underpaid, we don't think the pay is too generous either. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Pinnacle West Capital.
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.