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How Much Does O'Reilly Automotive's (NASDAQ:ORLY) CEO Make?

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Simply Wall St
·3 min read
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Greg Johnson has been the CEO of O'Reilly Automotive, Inc. (NASDAQ:ORLY) since 2018, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for O'Reilly Automotive.

View our latest analysis for O'Reilly Automotive

How Does Total Compensation For Greg Johnson Compare With Other Companies In The Industry?

At the time of writing, our data shows that O'Reilly Automotive, Inc. has a market capitalization of US$33b, and reported total annual CEO compensation of US$3.1m for the year to December 2019. We note that's a decrease of 37% compared to last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$977k.

In comparison with other companies in the industry with market capitalizations over US$8.0b , the reported median total CEO compensation was US$9.4m. Accordingly, O'Reilly Automotive pays its CEO under the industry median. Furthermore, Greg Johnson directly owns US$2.5m worth of shares in the company.

Component

2019

2018

Proportion (2019)

Salary

US$977k

US$804k

32%

Other

US$2.1m

US$4.1m

68%

Total Compensation

US$3.1m

US$4.9m

100%

On an industry level, around 20% of total compensation represents salary and 80% is other remuneration. It's interesting to note that O'Reilly Automotive pays out a greater portion of remuneration through salary, compared to the industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
ceo-compensation

A Look at O'Reilly Automotive, Inc.'s Growth Numbers

Over the past three years, O'Reilly Automotive, Inc. has seen its earnings per share (EPS) grow by 24% per year. Its revenue is up 13% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has O'Reilly Automotive, Inc. Been A Good Investment?

We think that the total shareholder return of 92%, over three years, would leave most O'Reilly Automotive, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

As previously discussed, Greg is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. When taking into account the company's strong EPS growth over the past three years, it appears CEO compensation is modest. Plus, we can't ignore the impressive shareholder returns, and won't be surprised if some shareholders were to reward such excellent all-around performance with a raise.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 2 warning signs for O'Reilly Automotive that you should be aware of before investing.

Switching gears from O'Reilly Automotive, 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 (at) simplywallst.com.