We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Schnitzer Steel Industries, Inc.'s (NASDAQ:SCHN) CEO For Now
Under the guidance of CEO Tamara Lundgren, Schnitzer Steel Industries, Inc. (NASDAQ:SCHN) has performed reasonably well recently. As shareholders go into the upcoming AGM on 25 January 2022, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.
See our latest analysis for Schnitzer Steel Industries
Comparing Schnitzer Steel Industries, Inc.'s CEO Compensation With the industry
Our data indicates that Schnitzer Steel Industries, Inc. has a market capitalization of US$1.1b, and total annual CEO compensation was reported as US$10m for the year to August 2021. That's a notable increase of 48% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.
On examining similar-sized companies in the industry with market capitalizations between US$400m and US$1.6b, we discovered that the median CEO total compensation of that group was US$2.5m. Hence, we can conclude that Tamara Lundgren is remunerated higher than the industry median. What's more, Tamara Lundgren holds US$35m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2021 | 2020 | Proportion (2021) |
Salary | US$1.2m | US$1.2m | 12% |
Other | US$9.0m | US$5.7m | 88% |
Total Compensation | US$10m | US$6.9m | 100% |
Speaking on an industry level, nearly 33% of total compensation represents salary, while the remainder of 67% is other remuneration. In Schnitzer Steel Industries' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at Schnitzer Steel Industries, Inc.'s Growth Numbers
Schnitzer Steel Industries, Inc.'s earnings per share (EPS) grew 8.3% per year over the last three years. It achieved revenue growth of 70% over the last year.
We like the look of the strong year-on-year improvement in revenue. Combined with modest EPS growth, we get a good impression of the company. We wouldn't say this is necessarily top notch growth, but it is certainly promising. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Schnitzer Steel Industries, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Schnitzer Steel Industries, Inc. for providing a total return of 90% over three years. 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.
To Conclude...
Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 3 warning signs for Schnitzer Steel Industries (of which 1 makes us a bit uncomfortable!) that you should know about in order to have a holistic understanding of the stock.
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.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
