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Why Stockland's (ASX:SGP) CEO Pay Matters To You

Simply Wall St

Mark Steinert became the CEO of Stockland (ASX:SGP) in 2013. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for Stockland

How Does Mark Steinert's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Stockland has a market cap of AU$12b, and reported total annual CEO compensation of AU$3.4m for the year to June 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at AU$1.6m. When we examined a selection of companies with market caps ranging from AU$5.8b to AU$17b, we found the median CEO total compensation was AU$4.2m.

That means Mark Steinert receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

You can see a visual representation of the CEO compensation at Stockland, below.

ASX:SGP CEO Compensation, January 11th 2020

Is Stockland Growing?

Stockland has reduced its earnings per share by an average of 19% a year, over the last three years (measured with a line of best fit). In the last year, its revenue changed by just 0.03%.

Unfortunately, earnings per share have trended lower over the last three years. And the flat revenue hardly impresses. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.

Has Stockland Been A Good Investment?

Stockland has served shareholders reasonably well, with a total return of 32% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

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

We feel that earnings per share have been a bit disappointing, but and we don't think the total returns are amazing. We do not think the CEO pay is a problem, but one might argue that the company should improve returns to shareholders before increasing it. So you may want to check if insiders are buying Stockland shares with their own money (free access).

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.

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.