Is National Retail Properties, Inc.’s (NYSE:NNN) CEO Being Overpaid?

Jay Whitehurst became the CEO of National Retail Properties, Inc. (NYSE:NNN) in 2017. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for National Retail Properties

How Does Jay Whitehurst’s Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that National Retail Properties, Inc. has a market cap of US$5.9b, and reported total annual CEO compensation of US$6.3m for the year to December 2019. We note that’s an increase of 29% above last year. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$825k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We looked at a group of companies with market capitalizations from US$4.0b to US$12b, and the median CEO total compensation was US$7.3m.

Pay mix tells us a lot about how a company functions versus the wider industry, and it’s no different in the case of National Retail Properties. On a sector level, around 15% of total compensation represents salary and 85% is other remuneration. National Retail Properties does not set aside a larger portion of remuneration in the form of salary, maintaining the same rate as the wider market.

That means Jay Whitehurst 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. The graphic below shows how CEO compensation at National Retail Properties has changed from year to year.

NYSE:NNN CEO Compensation April 15th 2020
NYSE:NNN CEO Compensation April 15th 2020

Is National Retail Properties, Inc. Growing?

Over the last three years National Retail Properties, Inc. has seen earnings per share (EPS) move in a positive direction by an average of 4.5% per year (using a line of best fit). It achieved revenue growth of 7.7% over the last year.

I’m not particularly impressed by the revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. You might want to check this free visual report on analyst forecasts for future earnings.

Has National Retail Properties, Inc. Been A Good Investment?

Since shareholders would have lost about 14% over three years, some National Retail Properties, Inc. shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary…

Jay Whitehurst is paid around the same as most CEOs of similar size companies.

The company cannot boast particularly strong per share growth. And it’s hard to argue that the returns over the last three years have delighted. This doesn’t look great when you consider CEO remuneration is up on last year. So many would argue that the CEO is certainly not underpaid. Taking a breather from CEO compensation, we’ve spotted 3 warning signs for National Retail Properties (of which 1 is a bit unpleasant!) you should know about in order to have a holistic understanding of the stock.

Important note: National Retail Properties 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.

If you spot an error that warrants correction, please contact the editor at 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.

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