Stock Analysis

How Much is EnerSys' (NYSE:ENS) CEO Getting Paid?

  •  Updated
Source: Shutterstock

This article will reflect on the compensation paid to Dave Shaffer who has served as CEO of EnerSys (NYSE:ENS) since 2016. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for EnerSys.

See our latest analysis for EnerSys

How Does Total Compensation For Dave Shaffer Compare With Other Companies In The Industry?

According to our data, EnerSys has a market capitalization of US$3.6b, and paid its CEO total annual compensation worth US$5.2m over the year to March 2020. This means that the compensation hasn't changed much from last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$940k.

For comparison, other companies in the same industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$3.5m. Accordingly, our analysis reveals that EnerSys pays Dave Shaffer north of the industry median. What's more, Dave Shaffer holds US$18m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component20202019Proportion (2020)
Salary US$940k US$900k 18%
Other US$4.3m US$4.3m 82%
Total CompensationUS$5.2m US$5.2m100%

On an industry level, around 29% of total compensation represents salary and 71% is other remuneration. EnerSys pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

NYSE:ENS CEO Compensation January 30th 2021

A Look at EnerSys' Growth Numbers

Over the last three years, EnerSys has shrunk its earnings per share by 15% per year. It saw its revenue drop 2.2% over the last year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 EnerSys Been A Good Investment?

EnerSys has served shareholders reasonably well, with a total return of 22% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

As we noted earlier, EnerSys pays its CEO higher than the norm for similar-sized companies belonging to the same industry. This doesn't look great when you realize that the company has been suffering from negative EPS growth for the last three years. And while shareholder returns have been respectable, they have hardly been superb. So you can understand why we do not think CEO compensation is particularly modest!

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 3 warning signs for EnerSys that investors should think about before committing capital to this stock.

Important note: EnerSys is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

When trading EnerSys or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

Valuation is complex, but we're helping make it simple.

Find out whether EnerSys is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

View the Free Analysis