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Doug Black has been the CEO of SiteOne Landscape Supply, Inc. (NYSE:SITE) since 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. 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 Doug Black's Compensation Compare With Similar Sized Companies?
According to our data, SiteOne Landscape Supply, Inc. has a market capitalization of US$2.7b, and pays its CEO total annual compensation worth US$3.5m. (This number is for the twelve months until December 2018). Notably, that's an increase of 19% over the year before. We think total compensation is more important but we note that the CEO salary is lower, at US$750k. We examined companies with market caps from US$2.0b to US$6.4b, and discovered that the median CEO total compensation of that group was US$5.3m.
Most shareholders would consider it a positive that Doug Black takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see a visual representation of the CEO compensation at SiteOne Landscape Supply, below.
Is SiteOne Landscape Supply, Inc. Growing?
Over the last three years SiteOne Landscape Supply, Inc. has grown its earnings per share (EPS) by an average of 104% per year (using a line of best fit). Its revenue is up 14% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has SiteOne Landscape Supply, Inc. Been A Good Investment?
Most shareholders would probably be pleased with SiteOne Landscape Supply, Inc. for providing a total return of 129% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
SiteOne Landscape Supply, Inc. is currently paying its CEO below what is normal for companies of its size. Considering the underlying business is growing earnings, this would suggest the pay is modest. The strong history of shareholder returns might even have some thinking that Doug Black deserves a raise!
Most shareholders like to see a modestly paid CEO combined with strong performance by the company. It would be even more positive if company insiders are buying shares. Shareholders may want to check for free if SiteOne Landscape Supply insiders are buying or selling shares.
Important note: SiteOne Landscape Supply 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.
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.
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. Thank you for reading.