Jeff Harmening has been the CEO of General Mills, Inc. (NYSE:GIS) since 2017. This analysis aims first to contrast CEO compensation with other large companies. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Jeff Harmening's Compensation Compare With Similar Sized Companies?
Our data indicates that General Mills, Inc. is worth US$32b, and total annual CEO compensation was reported as US$9.9m for the year to May 2019. While we always look at total compensation first, we note that the salary component is less, at US$1.2m. 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 took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO total compensation to be US$11m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
That means Jeff Harmening receives fairly typical remuneration for the CEO of a large company. 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 General Mills has changed over time.
Is General Mills, Inc. Growing?
On average over the last three years, General Mills, Inc. has grown earnings per share (EPS) by 5.1% each year (using a line of best fit). It achieved revenue growth of 3.1% over the last year.
I'm not particularly impressed by the revenue growth, but I'm happy with the modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing. You might want to check this free visual report on analyst forecasts for future earnings.
Has General Mills, Inc. Been A Good Investment?
Since shareholders would have lost about 3.4% over three years, some General Mills, Inc. shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
Jeff Harmening is paid around what is normal the leaders of larger companies.
We would like to see somewhat stronger per share growth. And shareholder returns have been disappointing over the last three years. So suffice it to say we don't think the compensation is modest. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at General Mills.
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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