Ralph Izzo has been the CEO of Public Service Enterprise Group Incorporated (NYSE:PEG) since 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. Next, we'll consider growth that the business demonstrates. 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 Ralph Izzo's Compensation Compare With Similar Sized Companies?
According to our data, Public Service Enterprise Group Incorporated has a market capitalization of US$27b, and paid its CEO total annual compensation worth US$13m over the year to December 2019. We note that's an increase of 25% above last year. While we always look at total compensation first, we note that the salary component is less, at US$1.4m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO total compensation was US$12m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. Speaking on an industry level, we can see that nearly 14% of total compensation represents salary, while the remainder of 86% is other remuneration. Public Service Enterprise Group does not set aside a larger portion of remuneration in the form of salary, maintaining the same rate as the wider market.
So Ralph Izzo is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance. You can see a visual representation of the CEO compensation at Public Service Enterprise Group, below.
Is Public Service Enterprise Group Incorporated Growing?
Public Service Enterprise Group Incorporated has seen earnings per share (EPS) move positively by an average of 26% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 3.9%.
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 Public Service Enterprise Group Incorporated Been A Good Investment?
Public Service Enterprise Group Incorporated has generated a total shareholder return of 29% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
Remuneration for Ralph Izzo is close enough to the median pay for a CEO of a large company .
The company is growing EPS but shareholder returns have been sound but not amazing. As a result of these considerations, I would suggest the CEO pay is reasonable. Shifting gears from CEO pay for a second, we've picked out 2 warning signs for Public Service Enterprise Group that investors should be aware of in a dynamic business environment.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
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.