Should You Worry About The Goodyear Tire & Rubber Company's (NASDAQ:GT) CEO Salary Level?
Rich Kramer became the CEO of The Goodyear Tire & Rubber Company (NASDAQ:GT) in 2010. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Goodyear Tire & Rubber
How Does Rich Kramer's Compensation Compare With Similar Sized Companies?
According to our data, The Goodyear Tire & Rubber Company has a market capitalization of US$3.4b, and pays its CEO total annual compensation worth US$6.2m. (This figure is for the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$1.3m. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$5.2m.
That means Rich Kramer receives fairly typical remuneration for the CEO of a company that size. 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 a visual representation of the CEO compensation at Goodyear Tire & Rubber, below.
Is The Goodyear Tire & Rubber Company Growing?
The Goodyear Tire & Rubber Company saw earnings per share stay pretty flat over the last three years, albeit with a slight decrease, according to the line of best fit. Its revenue is down -1.7% over last year.
Unfortunately there is a complete lack of earnings per share improvement, over three years. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. It could be important to check this free visual depiction of what analysts expect for the future.
Has The Goodyear Tire & Rubber Company Been A Good Investment?
With a three year total loss of 44%, The Goodyear Tire & Rubber Company would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
Rich Kramer is paid around the same as most CEOs of similar size companies.
Returns have been disappointing and the company is not growing its earnings per share. Few would argue that it's wise for the company to pay any more, before returns improve. Shareholders may want to check for free if Goodyear Tire & Rubber insiders are buying or selling shares.
If you want to buy a stock that is better than Goodyear Tire & Rubber, this free list of high return, low debt companies is a great place to look.
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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. Thank you for reading.
