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Is Retail Opportunity Investments Corp.'s (NASDAQ:ROIC) CEO Pay Fair?

Simply Wall St

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Stuart Tanz became the CEO of Retail Opportunity Investments Corp. (NASDAQ:ROIC) in 2009. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. 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.

See our latest analysis for Retail Opportunity Investments

How Does Stuart Tanz's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Retail Opportunity Investments Corp. has a market cap of US$2.2b, and is paying total annual CEO compensation of US$4.9m. (This is based on the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$850k. When we examined a selection of companies with market caps ranging from US$1.0b to US$3.2b, we found the median CEO total compensation was US$4.0m.

So Stuart Tanz receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at Retail Opportunity Investments, below.

NasdaqGS:ROIC CEO Compensation, July 9th 2019

Is Retail Opportunity Investments Corp. Growing?

Over the last three years Retail Opportunity Investments Corp. has grown its earnings per share (EPS) by an average of 10% per year (using a line of best fit). In the last year, its revenue is up 5.6%.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.

Has Retail Opportunity Investments Corp. Been A Good Investment?

Since shareholders would have lost about 11% over three years, some Retail Opportunity Investments Corp. shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Stuart Tanz is paid around the same as most CEOs of similar size companies.

We think that the EPS growth is very pleasing, but we find the returns over the last three years to be lacking. We'd be surprised if shareholders want to see a pay rise for the CEO, but we'd stop short of calling their pay too generous. Whatever your view on compensation, you might want to check if insiders are buying or selling Retail Opportunity Investments shares (free trial).

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity 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 editorial-team@simplywallst.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.