How Should Investors React To Sun Communities, Inc.’s (NYSE:SUI) CEO Pay?

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The CEO of Sun Communities, Inc. (NYSE:SUI) is Gary Shiffman. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Sun Communities

How Does Gary Shiffman’s Compensation Compare With Similar Sized Companies?

According to our data, Sun Communities, Inc. has a market capitalization of US$13b, and pays its CEO total annual compensation worth US$9.2m. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$692k. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO total compensation was US$11m. Once you start looking at very large companies, you need to take a broader range, because there simply aren’t that many of them.

So Gary Shiffman is paid around the average of the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.

You can see, below, how CEO compensation at Sun Communities has changed over time.

NYSE:SUI CEO Compensation, July 12th 2019
NYSE:SUI CEO Compensation, July 12th 2019

Is Sun Communities, Inc. Growing?

Sun Communities, Inc. has reduced its earnings per share by an average of 17% a year, over the last three years (measured with a line of best fit). It achieved revenue growth of 15% over the last year.

Sadly for shareholders, earnings per share are actually down, over three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration.

Has Sun Communities, Inc. Been A Good Investment?

Most shareholders would probably be pleased with Sun Communities, Inc. for providing a total return of 96% over three years. 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…

Remuneration for Gary Shiffman is close enough to the median pay for a CEO of a large company .

The company isn’t growing earnings per share, but shareholder returns have been strong over the last three years. So we doubt many are complaining about the fairly normal CEO pay. Whatever your view on compensation, you might want to check if insiders are buying or selling Sun Communities shares (free trial).

If you want to buy a stock that is better than Sun Communities, this free list of high return, low debt companies is a great place to look.

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.

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.