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This article will reflect on the compensation paid to Gary Michel who has served as CEO of JELD-WEN Holding, Inc. (NYSE:JELD) since 2018. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
How Does Total Compensation For Gary Michel Compare With Other Companies In The Industry?
According to our data, JELD-WEN Holding, Inc. has a market capitalization of US$2.4b, and paid its CEO total annual compensation worth US$5.5m over the year to December 2019. Notably, that's a decrease of 37% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$867k.
For comparison, other companies in the same industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$4.9m. From this we gather that Gary Michel is paid around the median for CEOs in the industry. Moreover, Gary Michel also holds US$1.4m worth of JELD-WEN Holding stock directly under their own name.
On an industry level, roughly 19% of total compensation represents salary and 81% is other remuneration. In JELD-WEN Holding's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
JELD-WEN Holding, Inc.'s Growth
Over the last three years, JELD-WEN Holding, Inc. has shrunk its earnings per share by 13% per year. In the last year, its revenue is down 3.7%.
Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has JELD-WEN Holding, Inc. Been A Good Investment?
Given the total shareholder loss of 39% over three years, many shareholders in JELD-WEN Holding, Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
As we noted earlier, JELD-WEN Holding pays its CEO in line with similar-sized companies belonging to the same industry. On the other hand, EPS growth and total shareholder return have been negative for the last three years. We'd stop short of saying compensation is inappropriate, but we would understand if shareholders had questions regarding a future raise.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 3 warning signs for JELD-WEN Holding that you should be aware of before investing.
Important note: JELD-WEN Holding is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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.
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