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In 2003 Ed Aldag was appointed CEO of Medical Properties Trust, Inc. (NYSE:MPW). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. 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 Ed Aldag's Compensation Compare With Similar Sized Companies?
Our data indicates that Medical Properties Trust, Inc. is worth US$7.4b, and total annual CEO compensation is US$13m. (This is based on the year to December 2018). Notably, that's an increase of 74% over the year before. While we always look at total compensation first, we note that the salary component is less, at US$1.0m. We examined companies with market caps from US$4.0b to US$12b, and discovered that the median CEO total compensation of that group was US$7.1m.
Thus we can conclude that Ed Aldag receives more in total compensation than the median of a group of companies in the same market, and of similar size to Medical Properties Trust, Inc.. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Medical Properties Trust has changed from year to year.
Is Medical Properties Trust, Inc. Growing?
Medical Properties Trust, Inc. has increased its earnings per share (EPS) by an average of 50% a year, over the last three years (using a line of best fit). Revenue was pretty flat on last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. You might want to check this free visual report on analyst forecasts for future earnings.
Has Medical Properties Trust, Inc. Been A Good Investment?
I think that the total shareholder return of 51%, over three years, would leave most Medical Properties Trust, Inc. shareholders smiling. 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 the total CEO remuneration paid by Medical Properties Trust, Inc., and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
Importantly, though, the company has impressed with its earnings per share growth, 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 Medical Properties Trust (free visualization of insider trades).
If you want to buy a stock that is better than Medical Properties Trust, this free list of high return, low debt companies is a great place to look.
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.