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A Quick Analysis On Weir Group's (LON:WEIR) CEO Salary
Jon Stanton became the CEO of The Weir Group PLC (LON:WEIR) in 2016, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Weir Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Check out our latest analysis for Weir Group
Comparing The Weir Group PLC's CEO Compensation With the industry
According to our data, The Weir Group PLC has a market capitalization of UK£2.8b, and paid its CEO total annual compensation worth UK£1.7m over the year to December 2019. That's a notable decrease of 28% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£682k.
In comparison with other companies in the industry with market capitalizations ranging from UK£1.6b to UK£5.2b, the reported median CEO total compensation was UK£1.7m. From this we gather that Jon Stanton is paid around the median for CEOs in the industry. What's more, Jon Stanton holds UK£1.3m worth of shares in the company in their own name.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | UK£682k | UK£664k | 39% |
| Other | UK£1.1m | UK£1.7m | 61% |
| Total Compensation | UK£1.7m | UK£2.4m | 100% |
Speaking on an industry level, nearly 48% of total compensation represents salary, while the remainder of 52% is other remuneration. Weir Group pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
The Weir Group PLC's Growth
Over the last three years, The Weir Group PLC has shrunk its earnings per share by 67% per year. Its revenue is up 8.7% over the last year.
Few shareholders would be pleased to read that earnings have declined. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in earnings per share. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has The Weir Group PLC Been A Good Investment?
Given the total shareholder loss of 35% over three years, many shareholders in The Weir Group PLC are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
As previously discussed, Jon is compensated close to the median for companies of its size, and which belong to the same industry. In the meantime, the company has reported declining earnings growth and shareholder returns over the last three years. We'd stop short of saying compensation is inappropriate, but we would understand if shareholders had questions regarding a future raise.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 3 warning signs for Weir Group (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.
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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Valuation is complex, but we're here to simplify it.
Discover if Weir might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
Access Free AnalysisThis 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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.
M
The Foxhole
Everyone's watching the oil price. The harder problem is the gas that can't take a detour.
98
R
Rob_Curious
What I've learnt in the last six months is that fuel supply disruption is a real portfolio risk, and one of the better hedges is a small allocation to shipping. Though it's insane how much these have run up this year.
f
frank_ub3n0
Spot on. Shipping and logistics is much larger constraint for gas than oil. Sorry to break it to you. No quick fixes for that.
Mitchell LawlerMarket Insights
What happens to energy stocks as the fix gets built?
Conflict around the Strait of Hormuz has led investors to oil and tankers. The trouble is, the antidote to the chokepoints is already being built, and it may not reward the same energy stocks.
22
About LSE:WEIR
Weir
Produces and sells highly engineered original equipment worldwide.
Good value with adequate balance sheet.
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anthony_x0j2w on Platform Group SE KGaA ·
Hello,(I am a shareholder).I spent the summer investigating in whatever I was able to find in the press, the trustee, or legal, and comparing it to FS Benner's declaration/transcripts:press: MM has a tendancy to use facts, modify them and turn them the way they want: 100% of their claims against TPG0 is traçable factually, 80% is flawed and interpreted. Example are numerous: 11M loans banks to be paid seems right, but it has not been an issue at all, it has been paid in full. (and it happens all the time in every business...); the previous HR becoming a financial director in the article herself being attacked by TPG on the legal side; the wrong address of curator (if truly announced by TPG).Trustee: according to my research (which can be incomplete) no communication to the Nordic trustee (hereby, bond holders) has been done on a, indebtedness (late payment) > 1M€, which is their obligation by contract (clause 14.d - https://corporate.the-platform-group.com/bond/) => this is a sign of a huge lie and fraud, or the sign that there is no indebtedness > 1M€ over the whole TPG group.Legal: still awaiting for an answer, probable that I won't get it.VALUATIONYou can spent hours working the fundamentals, if they're flawed...the thesis falls.Anyway, I always substracts the badwill (that I consider non-current - you have it in the CFS) & non-controlling interests from my valuation:Earnings ~22MFCF ~40M€The financial statements are not the issue here, we are more on an cheap option on the sincerity of the accounts that a real valuation. Unfortunately, these are unverifiable elements, hence the low price./!\ Careful:the accounts are consolidated and skip the subsidiaries issues...Careful with the business model: TPG0 is a financial holding that acquire subsidiaries, hold the debt, and has no operations. 100% of the Cash Flow comes from subs' dividends => it is a risk here, more a plumber risk than an operational one, but nevertheless...The auditor is too small, and managed by the same firm than before, with 140K€/year commission => it's too low, nobody external really reviewed what Benner and his team are doing internallycapital increase do not go through the CFS, but through change in equity AND equity in the BSIf the equity stays low too long, the WACC increase will be unbearable (I have a 30% global, with a 118% on equity): diluting is expensive => TPG machine can stay broken for a while.Most of the people I talk with never saw this, while this is ESSENTIAL to Benner's business model.SEVERAL EVENTS THAT COULD CHANGE:AEP is being audited by KPMG: if Benner plays the "we will propose KPMG to our shareholders BEOY", this can increase the trust in him significantly/KPMG (or other) to validate the 2026 IFRS accounts & having a word on HGB's: though still consolidated, at least we'll know...AEP being eventually acquired: while it carries a high integration risk due to its size, they talked about it so many times, that trust goes with it.Without this combination of event, the equity is doomed to stay at this level, IMO.Do not forget to also follow the bond: with TPG's announced safe harbor plan for buyback (25% of daily exchange), it is also interesting to check this illiquid and retail market: https://live.deutsche-boerse.com/bond/no0013256834-the-platform-group-ag-8-875-24-28?mic=XFRA
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