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How Much is Generac Holdings Inc.'s (NYSE:GNRC) CEO Getting Paid?

Simply Wall St
·3 min read

In 2008 Aaron Jagdfeld was appointed CEO of Generac Holdings Inc. (NYSE:GNRC). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Generac Holdings

How Does Aaron Jagdfeld's Compensation Compare With Similar Sized Companies?

According to our data, Generac Holdings Inc. has a market capitalization of US$6.0b, and paid its CEO total annual compensation worth US$5.9m over the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$863k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We looked at a group of companies with market capitalizations from US$4.0b to US$12b, and the median CEO total compensation was US$7.6m.

Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On a sector level, around 32% of total compensation represents salary and 68% is other remuneration. Generac Holdings sets aside a smaller share of compensation for salary, in comparison to the overall industry.

That means Aaron Jagdfeld receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance. The graphic below shows how CEO compensation at Generac Holdings has changed from year to year.

NYSE:GNRC CEO Compensation April 17th 2020
NYSE:GNRC CEO Compensation April 17th 2020

Is Generac Holdings Inc. Growing?

Generac Holdings Inc. has seen earnings per share (EPS) move positively by an average of 35% a year, over the last three years (using a line of best fit). It achieved revenue growth of 8.9% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. It could be important to check this free visual depiction of what analysts expect for the future.

Has Generac Holdings Inc. Been A Good Investment?

I think that the total shareholder return of 168%, over three years, would leave most Generac Holdings Inc. shareholders smiling. 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.

In Summary...

Aaron Jagdfeld is paid around the same as most CEOs of similar size companies.

Shareholders would surely be happy to see that shareholder returns have been great, and the earnings per share are up. Indeed, many might consider the pay rather modest, given the solid company performance! Shifting gears from CEO pay for a second, we've picked out 1 warning sign for Generac Holdings that investors should be aware of in a dynamic business environment.

Important note: Generac Holdings may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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.

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. Thank you for reading.