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Doug Black has been the CEO of SiteOne Landscape Supply, Inc. (NYSE:SITE) since 2014. 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 Doug Black’s Compensation Compare With Similar Sized Companies?
Our data indicates that SiteOne Landscape Supply, Inc. is worth US$2.7b, and total annual CEO compensation is US$3.5m. (This is based on the year to December 2018). That’s a notable increase of 19% on last year. We think total compensation is more important but we note that the CEO salary is lower, at US$750k. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$5.3m.
A first glance this seems like a real positive for shareholders, since Doug Black is paid less than the average total compensation paid by similar sized companies. Though positive, it’s important we delve into the performance of the actual business.
You can see a visual representation of the CEO compensation at SiteOne Landscape Supply, below.
Is SiteOne Landscape Supply, Inc. Growing?
On average over the last three years, SiteOne Landscape Supply, Inc. has grown earnings per share (EPS) by 104% each year (using a line of best fit). In the last year, its revenue is up 14%.
This demonstrates that the company has been improving recently. A good result. It’s a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has SiteOne Landscape Supply, Inc. Been A Good Investment?
Boasting a total shareholder return of 132% over three years, SiteOne Landscape Supply, Inc. 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.
It appears that SiteOne Landscape Supply, Inc. remunerates its CEO below most similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. The strong history of shareholder returns might even have some thinking that Doug Black deserves a raise!
It’s not often we see shareholders do so well, and yet the CEO is paid modestly. The cherry on top would be if company insiders are buying shares with their own money. Whatever your view on compensation, you might want to check if insiders are buying or selling SiteOne Landscape Supply shares (free trial).
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.
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 firstname.lastname@example.org. 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.