Anthony Petrello became the CEO of Nabors Industries Ltd. (NYSE:NBR) in 2011. First, this article will compare CEO compensation with compensation at similar sized companies. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Anthony Petrello’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Nabors Industries Ltd. has a market cap of US$1.0b, and is paying total annual CEO compensation of US$14m. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$1.8m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$400m to US$1.6b. The median total CEO compensation was US$2.3m.
Thus we can conclude that Anthony Petrello receives more in total compensation than the median of a group of companies in the same market, and of similar size to Nabors Industries Ltd.. 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 Nabors Industries has changed from year to year.
Is Nabors Industries Ltd. Growing?
Nabors Industries Ltd. has increased its earnings per share (EPS) by an average of 17% a year, over the last three years It achieved revenue growth of 25% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business.
You might want to check this free visual report on analyst forecasts for future earnings.
Has Nabors Industries Ltd. Been A Good Investment?
With a three year total loss of 65%, Nabors Industries Ltd. would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We compared total CEO remuneration at Nabors Industries Ltd. with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. Considering the per share profit growth, but keeping in mind the weak returns, we’d need more time to form a view on CEO compensation. Shareholders may want to check for free if Nabors Industries insiders are buying or selling shares.
Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.