What We Learned About Hartford Financial Services Group’s (NYSE:HIG) CEO Compensation

Chris Swift became the CEO of The Hartford Financial Services Group, Inc. (NYSE:HIG) in 2014, 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 Hartford Financial Services Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Hartford Financial Services Group

Comparing The Hartford Financial Services Group, Inc.’s CEO Compensation With the industry

According to our data, The Hartford Financial Services Group, Inc. has a market capitalization of US$13b, and paid its CEO total annual compensation worth US$15m over the year to December 2019. That’s just a smallish increase of 4.9% on last year. While this analysis focuses on total compensation, it’s worth acknowledging that the salary portion is lower, valued at US$1.2m.

For comparison, other companies in the industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$14m. This suggests that Hartford Financial Services Group remunerates its CEO largely in line with the industry average. Furthermore, Chris Swift directly owns US$20m worth of shares in the company, implying that they are deeply invested in the company’s success.

Component20192018Proportion (2019)
Salary US$1.2m US$1.1m 8%
Other US$13m US$13m 92%
Total CompensationUS$15m US$14m100%

On an industry level, around 17% of total compensation represents salary and 83% is other remuneration. Hartford Financial Services 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.

ceo-compensation
NYSE:HIG CEO Compensation September 16th 2020

A Look at The Hartford Financial Services Group, Inc.’s Growth Numbers

The Hartford Financial Services Group, Inc.’s earnings per share (EPS) grew 103% per year over the last three years. Its revenue is up 6.2% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 Hartford Financial Services Group, Inc. Been A Good Investment?

With a three year total loss of 27% for the shareholders, The Hartford Financial Services Group, Inc. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary…

As we touched on above, The Hartford Financial Services Group, Inc. is currently paying a compensation that’s close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. On the other hand, the company has logged negative shareholder returns over the previous three years. But on the bright side, EPS growth is positive over the same period. Overall, we wouldn’t say Chris is paid an unjustified compensation, but shareholders might not favor a raise before shareholder returns show a positive trend.

Shareholders may want to check for free if Hartford Financial Services Group insiders are buying or selling shares.

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.

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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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