How Is Vista Outdoor's (NYSE:VSTO) CEO Compensated?
Chris Metz became the CEO of Vista Outdoor Inc. (NYSE:VSTO) in 2017, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Check out our latest analysis for Vista Outdoor
How Does Total Compensation For Chris Metz Compare With Other Companies In The Industry?
At the time of writing, our data shows that Vista Outdoor Inc. has a market capitalization of US$1.5b, and reported total annual CEO compensation of US$3.9m for the year to March 2020. We note that's a decrease of 36% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.0m.
In comparison with other companies in the industry with market capitalizations ranging from US$1.0b to US$3.2b, the reported median CEO total compensation was US$2.6m. This suggests that Chris Metz is paid more than the median for the industry. Moreover, Chris Metz also holds US$5.6m worth of Vista Outdoor stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2020 | 2019 | Proportion (2020) |
Salary | US$1.0m | US$981k | 26% |
Other | US$2.9m | US$5.1m | 74% |
Total Compensation | US$3.9m | US$6.1m | 100% |
On an industry level, around 26% of total compensation represents salary and 74% is other remuneration. Although there is a difference in how total compensation is set, Vista Outdoor more or less reflects the market in terms of setting the salary. 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 Vista Outdoor Inc.'s Growth Numbers
Vista Outdoor Inc. has seen its earnings per share (EPS) increase by 10% a year over the past three years. The trailing twelve months of revenue was pretty much the same as the prior period.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Vista Outdoor Inc. Been A Good Investment?
Boasting a total shareholder return of 81% over three years, Vista Outdoor Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
To Conclude...
As previously discussed, Chris is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. But EPS growth and shareholder returns have been top-notch for the past three years. As a result of the excellent all-round performance of the company, we believe CEO compensation is fair. The pleasing shareholder returns are the cherry on top. We wouldn't be wrong in saying that shareholders feel that Chris's performance creates value for the company.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Vista Outdoor that investors should think about before committing capital to this stock.
Important note: Vista Outdoor 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.
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