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Why EnerSys's (NYSE:ENS) CEO Pay Matters To You

Simply Wall St

Dave Shaffer became the CEO of EnerSys (NYSE:ENS) in 2016. 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. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for EnerSys

How Does Dave Shaffer's Compensation Compare With Similar Sized Companies?

According to our data, EnerSys has a market capitalization of US$3.1b, and paid its CEO total annual compensation worth US$5.2m over the year to March 2019. We think total compensation is more important but we note that the CEO salary is lower, at US$900k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We looked at a group of companies with market capitalizations from US$2.0b to US$6.4b, and the median CEO total compensation was US$4.9m.

So Dave Shaffer 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, below, how CEO compensation at EnerSys has changed over time.

NYSE:ENS CEO Compensation, January 22nd 2020
NYSE:ENS CEO Compensation, January 22nd 2020

Is EnerSys Growing?

On average over the last three years, EnerSys has grown earnings per share (EPS) by 7.4% each year (using a line of best fit). In the last year, its revenue is up 13%.

This revenue growth could really point to a brighter future. And the improvement in earnings per share is modest but respectable. Although we'll stop short of calling the stock a top performer, we think the company has potential. You might want to check this free visual report on analyst forecasts for future earnings.

Has EnerSys Been A Good Investment?

Given the total loss of 6.3% over three years, many shareholders in EnerSys are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Remuneration for Dave Shaffer is close enough to the median pay for a CEO of a similar sized company .

The company cannot boast particularly strong per share growth. And we think the shareholder returns - over three years - have been underwhelming. So many would argue that the CEO is certainly not underpaid. Shareholders may want to check for free if EnerSys insiders are buying or selling shares.

Important note: EnerSys may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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.

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. Thank you for reading.