In 2013 Jeff Sloan was appointed CEO of Global Payments Inc. (NYSE:GPN). This analysis aims first to contrast CEO compensation with 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 Jeff Sloan's Compensation Compare With Similar Sized Companies?
Our data indicates that Global Payments Inc. is worth US$25b, and total annual CEO compensation is US$17m. (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$1.0m. We took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO total compensation to be US$11m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
As you can see, Jeff Sloan is paid more than the median CEO pay at large companies, in the same market. However, this does not necessarily mean Global Payments Inc. is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Global Payments has changed from year to year.
Is Global Payments Inc. Growing?
Global Payments Inc. has increased its earnings per share (EPS) by an average of 28% a year, over the last three years (using a line of best fit). Its revenue is down -4.4% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. Revenue growth is a real positive for growth, but ultimately profits are more important. Shareholders might be interested in this free visualization of analyst forecasts.
Has Global Payments Inc. Been A Good Investment?
Most shareholders would probably be pleased with Global Payments Inc. for providing a total return of 117% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
We compared the total CEO remuneration paid by Global Payments Inc., and compared it to remuneration at a group of other large companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. In addition, shareholders have done well over the same time period. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Global Payments (free visualization of insider trades).
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.
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If you spot an error that warrants correction, please contact the editor at email@example.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. Thank you for reading.