How Should Investors React To Oshkosh Corporation’s (NYSE:OSK) CEO Pay?

Wilson Jones has been the CEO of Oshkosh Corporation (NYSE:OSK) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Oshkosh

How Does Wilson Jones’s Compensation Compare With Similar Sized Companies?

According to our data, Oshkosh Corporation has a market capitalization of US$5.6b, and pays its CEO total annual compensation worth US$11m. (This number is for the twelve months until September 2018). That’s a fairly small increase of 1.5% on year before. While we always look at total compensation first, we note that the salary component is less, at US$1.2m. We examined companies with market caps from US$4.0b to US$12b, and discovered that the median CEO compensation of that group was US$6.2m.

As you can see, Wilson Jones is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Oshkosh Corporation is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

The graphic below shows how CEO compensation at Oshkosh has changed from year to year.

NYSE:OSK CEO Compensation, March 4th 2019
NYSE:OSK CEO Compensation, March 4th 2019

Is Oshkosh Corporation Growing?

Over the last three years Oshkosh Corporation has grown its earnings per share (EPS) by an average of 36% per year (using a line of best fit). Its revenue is up 10.0% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It’s also good to see modest revenue growth, suggesting the underlying business is healthy. You might want to check this free visual report on analyst forecasts for future earnings.

Has Oshkosh Corporation Been A Good Investment?

Most shareholders would probably be pleased with Oshkosh Corporation for providing a total return of 122% over three years. 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.

In Summary…

We compared total CEO remuneration at Oshkosh Corporation with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. Whatever your view on compensation, you might want to check if insiders are buying or selling Oshkosh shares (free trial).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.