Philip Mezey became the CEO of Itron, Inc. (NASDAQ:ITRI) in 2013. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. 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 Itron
How Does Philip Mezey’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Itron, Inc. has a market cap of US$2.5b, and is paying total annual CEO compensation of US$5.0m. (This number is for the twelve months until December 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$821k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$2.0b to US$6.4b. The median total CEO compensation was US$5.1m.
So Philip Mezey receives a similar amount to the median CEO pay, amongst the companies we looked at. 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 Itron, below.
Is Itron, Inc. Growing?
Over the last three years Itron, Inc. has shrunk its earnings per share by an average of 67% per year (measured with a line of best fit). In the last year, its revenue is up 11%.
Unfortunately, earnings per share have trended lower over the last three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.
Has Itron, Inc. Been A Good Investment?
I think that the total shareholder return of 47%, over three years, would leave most Itron, Inc. shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
In Summary…
Philip Mezey is paid around what is normal the leaders of comparable size companies.
We feel that earnings per share have been a bit disappointing, but it’s nice to see positive shareholder returns over the last three years. So we think most shareholders wouldn’t be too worried about CEO compensation, which is close to the median for similar sized companies. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Itron.
Important note: Itron may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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