U.S. markets closed
  • S&P 500

    3,841.94
    +73.47 (+1.95%)
     
  • Dow 30

    31,496.30
    +572.16 (+1.85%)
     
  • Nasdaq

    12,920.15
    +196.68 (+1.55%)
     
  • Russell 2000

    2,192.21
    +45.29 (+2.11%)
     
  • Crude Oil

    66.28
    +2.45 (+3.84%)
     
  • Gold

    1,698.20
    -2.50 (-0.15%)
     
  • Silver

    25.30
    -0.17 (-0.65%)
     
  • EUR/USD

    1.1925
    -0.0054 (-0.45%)
     
  • 10-Yr Bond

    1.5540
    +0.0040 (+0.26%)
     
  • GBP/USD

    1.3827
    -0.0067 (-0.48%)
     
  • USD/JPY

    108.2450
    +0.2690 (+0.25%)
     
  • BTC-USD

    48,206.71
    +1,133.07 (+2.41%)
     
  • CMC Crypto 200

    982.93
    +39.75 (+4.21%)
     
  • FTSE 100

    6,630.52
    -20.36 (-0.31%)
     
  • Nikkei 225

    28,864.32
    -65.78 (-0.23%)
     

Our Take On Valvoline's (NYSE:VVV) CEO Salary

  • Oops!
    Something went wrong.
    Please try again later.
Simply Wall St
·3 min read
  • Oops!
    Something went wrong.
    Please try again later.

This article will reflect on the compensation paid to Sam Mitchell who has served as CEO of Valvoline Inc. (NYSE:VVV) since 2016. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Valvoline

How Does Total Compensation For Sam Mitchell Compare With Other Companies In The Industry?

Our data indicates that Valvoline Inc. has a market capitalization of US$4.4b, and total annual CEO compensation was reported as US$5.4m for the year to September 2020. That's a notable increase of 18% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$986k.

For comparison, other companies in the same industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$5.5m. So it looks like Valvoline compensates Sam Mitchell in line with the median for the industry. Furthermore, Sam Mitchell directly owns US$5.8m worth of shares in the company, implying that they are deeply invested in the company's success.

Component

2020

2019

Proportion (2020)

Salary

US$986k

US$961k

18%

Other

US$4.4m

US$3.6m

82%

Total Compensation

US$5.4m

US$4.6m

100%

On an industry level, around 19% of total compensation represents salary and 81% is other remuneration. Valvoline is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ceo-compensation
ceo-compensation

Valvoline Inc.'s Growth

Valvoline Inc. has seen its earnings per share (EPS) increase by 4.4% a year over the past three years. Its revenue is down 1.6% over the previous year.

We generally like to see a little revenue growth, but the modest EPSgrowth gives us some relief. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Valvoline Inc. Been A Good Investment?

Given the total shareholder loss of 0.4% over three years, many shareholders in Valvoline Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As previously discussed, Sam is compensated close to the median for companies of its size, and which belong to the same industry. But with negative shareholder returns and unimpressive EPS growth, shareholders will surely be disturbed. CEO pay isn't exceptionally high, but considering poor performance, shareholders will likely hold off support for a raise until results improve.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 3 warning signs (and 1 which makes us a bit uncomfortable) in Valvoline we think you should know about.

Important note: Valvoline is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.