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Jim Robo became the CEO of NextEra Energy, Inc. (NYSE:NEE) in 2012. First, this article will compare CEO compensation with compensation at other large companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Jim Robo's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that NextEra Energy, Inc. has a market cap of US$100b, and is paying total annual CEO compensation of US$21m. (This figure is for the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$1.4m. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO total compensation was US$11m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).
As you can see, Jim Robo is paid more than the median CEO pay at large companies, in the same market. However, this does not necessarily mean NextEra Energy, Inc. is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at NextEra Energy has changed over time.
Is NextEra Energy, Inc. Growing?
On average over the last three years, NextEra Energy, Inc. has grown earnings per share (EPS) by 31% each year (using a line of best fit). The trailing twelve months of revenue was pretty much the same as the prior period.
This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. It could be important to check this free visual depiction of what analysts expect for the future.
Has NextEra Energy, Inc. Been A Good Investment?
Boasting a total shareholder return of 75% over three years, NextEra Energy, Inc. has done well by shareholders. 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.
We compared total CEO remuneration at NextEra Energy, Inc. with the amount paid at other large companies. Our data suggests that it pays above the median CEO pay within 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. As a result of this good performance, the CEO remuneration may well be quite reasonable. So you may want to check if insiders are buying NextEra Energy shares with their own money (free access).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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 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.