In 2014 Lynn Jurich was appointed CEO of Sunrun Inc. (NASDAQ:RUN). 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Lynn Jurich's Compensation Compare With Similar Sized Companies?
Our data indicates that Sunrun Inc. is worth US$1.9b, and total annual CEO compensation is US$845k. (This number is for the twelve months until December 2018). While we always look at total compensation first, we note that the salary component is less, at US$500k. We looked at a group of companies with market capitalizations from US$1.0b to US$3.2b, and the median CEO total compensation was US$4.1m.
Most shareholders would consider it a positive that Lynn Jurich takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it's important we delve into the performance of the actual business.
You can see, below, how CEO compensation at Sunrun has changed over time.
Is Sunrun Inc. Growing?
Over the last three years Sunrun Inc. has shrunk its earnings per share by an average of 15% per year (measured with a line of best fit). In the last year, its revenue is up 38%.
The reduction in earnings per share, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch. Shareholders might be interested in this free visualization of analyst forecasts.
Has Sunrun Inc. Been A Good Investment?
I think that the total shareholder return of 159%, over three years, would leave most Sunrun 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.
It looks like Sunrun Inc. pays its CEO less than similar sized companies.
Lynn Jurich is paid less than what is normal at similar size companies, and the total shareholder return has been pleasing over the last three years. We would like to see EPS growth, but in our view it seems the CEO is modestly remunerated. Whatever your view on compensation, you might want to check if insiders are buying or selling Sunrun shares (free trial).
If you want to buy a stock that is better than Sunrun, this free list of high return, low debt companies is a great place to look.
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