Allegion plc's (NYSE:ALLE) CEO Will Probably Have Their Compensation Approved By Shareholders

Key Insights

• Allegion to hold its Annual General Meeting on 5th of June
• Total pay for CEO John Stone includes US$1.04m salary
• The overall pay is comparable to the industry average
• Allegion's EPS grew by 11% over the past three years while total shareholder return over the past three years was 34%

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The performance at Allegion plc (NYSE:ALLE) has been quite strong recently and CEO John Stone has played a role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 5th of June. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Allegion

Comparing Allegion plc's CEO Compensation With The Industry

Our data indicates that Allegion plc has a market capitalization of US$12b, and total annual CEO compensation was reported as US$8.5m for the year to December 2024. That's a slight decrease of 6.0% on the prior year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.0m.

In comparison with other companies in the American Building industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$9.2m. So it looks like Allegion compensates John Stone in line with the median for the industry. What's more, John Stone holds US$9.8m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 16% of total compensation represents salary and 84% is other remuneration. In Allegion's case, non-salary compensation represents a greater slice of total remuneration, in comparison 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.

A Look at Allegion plc's Growth Numbers

Over the past three years, Allegion plc has seen its earnings per share (EPS) grow by 11% per year. In the last year, its revenue is up 5.5%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. 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 Allegion plc Been A Good Investment?

Boasting a total shareholder return of 34% over three years, Allegion plc has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Allegion that investors should look into moving forward.

Switching gears from Allegion, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.