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John Plueger has been the CEO of Air Lease Corporation (NYSE:AL) since 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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.
How Does John Plueger’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Air Lease Corporation has a market cap of US$4.2b, and is paying total annual CEO compensation of US$8.1m. (This number is for the twelve months until 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$1.0m. We looked at a group of companies with market capitalizations from US$2.0b to US$6.4b, and the median CEO compensation was US$4.8m.
As you can see, John Plueger is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Air Lease Corporation is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Air Lease has changed from year to year.
Is Air Lease Corporation Growing?
Over the last three years Air Lease Corporation has grown its earnings per share (EPS) by an average of 43% per year (using a line of best fit). Its revenue is up 9.4% over 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. Shareholders might be interested in this free visualization of analyst forecasts.
Has Air Lease Corporation Been A Good Investment?
Boasting a total shareholder return of 66% over three years, Air Lease Corporation has done well by shareholders. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.
We compared total CEO remuneration at Air Lease Corporation with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
However, the earnings per share growth over three years is certainly impressive. On top of that, in the same period, returns to shareholders have been great. So, considering this good performance, the CEO compensation may be quite appropriate. Whatever your view on compensation, you might want to check if insiders are buying or selling Air Lease shares (free trial).
If you want to buy a stock that is better than Air Lease, this free list of high return, low debt companies is a great place to look.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.