Here's Why Shareholders Will Not Be Complaining About Sterling Infrastructure, Inc.'s (NASDAQ:STRL) CEO Pay Packet

Key Insights

• Sterling Infrastructure to hold its Annual General Meeting on 9th of May
• Salary of US$1.00m is part of CEO Joe Cutillo's total remuneration
• Total compensation is similar to the industry average
• Sterling Infrastructure's total shareholder return over the past three years was 334% while its EPS grew by 42% over the past three years

The performance at Sterling Infrastructure, Inc. (NASDAQ:STRL) has been quite strong recently and CEO Joe Cutillo has played a role in it. Coming up to the next AGM on 9th of May, shareholders would be keeping this in mind. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.

See our latest analysis for Sterling Infrastructure

Comparing Sterling Infrastructure, Inc.'s CEO Compensation With The Industry

At the time of writing, our data shows that Sterling Infrastructure, Inc. has a market capitalization of US$3.1b, and reported total annual CEO compensation of US$6.1m for the year to December 2023. We note that's an increase of 17% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.0m.

In comparison with other companies in the American Construction industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$5.3m. From this we gather that Joe Cutillo is paid around the median for CEOs in the industry. Moreover, Joe Cutillo also holds US$37m worth of Sterling Infrastructure stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	US$1.0m	US$830k	17%
Other	US$5.1m	US$4.3m	83%
Total Compensation	US$6.1m	US$5.2m	100%

Speaking on an industry level, nearly 22% of total compensation represents salary, while the remainder of 78% is other remuneration. Sterling Infrastructure sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Sterling Infrastructure, Inc.'s Growth

Sterling Infrastructure, Inc.'s earnings per share (EPS) grew 42% per year over the last three years. In the last year, its revenue is up 11%.

Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Sterling Infrastructure, Inc. Been A Good Investment?

Most shareholders would probably be pleased with Sterling Infrastructure, Inc. for providing a total return of 334% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Sterling Infrastructure that you should be aware of before investing.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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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.