CEO Marc Michael has done a decent job of delivering relatively good performance at SPX FLOW, Inc. (NYSE:FLOW) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 12 May 2021. Here is our take on why we think the CEO compensation looks appropriate.
Check out our latest analysis for SPX FLOW
Comparing SPX FLOW, Inc.'s CEO Compensation With the industry
According to our data, SPX FLOW, Inc. has a market capitalization of US$2.9b, and paid its CEO total annual compensation worth US$5.4m over the year to December 2020. Notably, that's an increase of 12% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$945k.
In comparison with other companies in the industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$5.4m. So it looks like SPX FLOW compensates Marc Michael in line with the median for the industry. What's more, Marc Michael holds US$12m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
|
Component |
2020 |
2019 |
Proportion (2020) |
|
Salary |
US$945k |
US$915k |
17% |
|
Other |
US$4.5m |
US$3.9m |
83% |
|
Total Compensation |
US$5.4m |
US$4.9m |
100% |
Talking in terms of the industry, salary represented approximately 19% of total compensation out of all the companies we analyzed, while other remuneration made up 81% of the pie. Although there is a difference in how total compensation is set, SPX FLOW more or less reflects the market in terms of setting the salary. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
SPX FLOW, Inc.'s Growth
SPX FLOW, Inc. has seen its earnings per share (EPS) increase by 7.9% a year over the past three years. Its revenue is down 10% over the previous year.
We would prefer it if there was revenue growth, but the modest EPS growth gives us some relief. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has SPX FLOW, Inc. Been A Good Investment?
We think that the total shareholder return of 58%, over three years, would leave most SPX FLOW, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.
CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 1 warning sign for SPX FLOW that investors should look into moving forward.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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SPX FLOW, Inc.'s (NYSE:FLOW) CEO Compensation Looks Acceptable To Us And Here's Why - Yahoo Finance
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