In 2016 Maria Hawthorne was appointed CEO of PS Business Parks, Inc. (NYSE:PSB). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Maria Hawthorne's Compensation Compare With Similar Sized Companies?
According to our data, PS Business Parks, Inc. has a market capitalization of US$5.7b, and paid its CEO total annual compensation worth US$3.8m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$451k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. 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$6.4m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at PS Business Parks has changed over time.
Is PS Business Parks, Inc. Growing?
Over the last three years PS Business Parks, Inc. has grown its earnings per share (EPS) by an average of 26% per year (using a line of best fit). Its revenue is up 4.0% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Shareholders might be interested in this free visualization of analyst forecasts.
Has PS Business Parks, Inc. Been A Good Investment?
Boasting a total shareholder return of 51% over three years, PS Business Parks, Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
It appears that PS Business Parks, Inc. remunerates its CEO below most similar sized companies.
Since the business is growing, many would argue this suggests the pay is modest. The strong history of shareholder returns might even have some thinking that Maria Hawthorne deserves a raise! It's not often we see shareholders do so well, and yet the CEO is paid modestly. The cherry on top would be if company insiders are buying shares with their own money. Whatever your view on compensation, you might want to check if insiders are buying or selling PS Business Parks shares (free trial).
If you want to buy a stock that is better than PS Business Parks, this free list of high return, low debt companies is a great place to look.
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