Here's Why We Think Ashtead Group plc's (LON:AHT) CEO Compensation Looks Fair for the time being

Key Insights

• Ashtead Group will host its Annual General Meeting on 2nd of September
• Total pay for CEO Brendan Horgan includes US$1.17m salary
• Total compensation is similar to the industry average
• Over the past three years, Ashtead Group's EPS grew by 7.7% and over the past three years, the total shareholder return was 34%

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Under the guidance of CEO Brendan Horgan, Ashtead Group plc (LON:AHT) has performed reasonably well recently. As shareholders go into the upcoming AGM on 2nd of September, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. Here is our take on why we think the CEO compensation looks appropriate.

Check out our latest analysis for Ashtead Group

Comparing Ashtead Group plc's CEO Compensation With The Industry

According to our data, Ashtead Group plc has a market capitalization of UK£24b, and paid its CEO total annual compensation worth US$5.0m over the year to April 2025. That's a notable decrease of 29% 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.

On comparing similar companies in the British Trade Distributors industry with market capitalizations above UK£5.9b, we found that the median total CEO compensation was US$4.3m. This suggests that Ashtead Group remunerates its CEO largely in line with the industry average. Furthermore, Brendan Horgan directly owns UK£23m worth of shares in the company, implying that they are deeply invested in the company's success.

Speaking on an industry level, nearly 52% of total compensation represents salary, while the remainder of 48% is other remuneration. In Ashtead Group's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Ashtead Group plc's Growth

Over the past three years, Ashtead Group plc has seen its earnings per share (EPS) grow by 7.7% per year. The trailing twelve months of revenue was pretty much the same as the prior period.

We would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see a modest EPS growth at least. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Ashtead Group plc Been A Good Investment?

Boasting a total shareholder return of 34% over three years, Ashtead Group plc has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Ashtead Group that investors should think about before committing capital to this stock.

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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.