Westinghouse Air Brake Technologies Corporation's (NYSE:WAB) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Westinghouse Air Brake Technologies to hold its Annual General Meeting on 16th of May
• CEO Rafael Santana's total compensation includes salary of US$1.33m
• Total compensation is 32% above industry average
• Westinghouse Air Brake Technologies' total shareholder return over the past three years was 116% while its EPS grew by 34% over the past three years

CEO Rafael Santana has done a decent job of delivering relatively good performance at Westinghouse Air Brake Technologies Corporation (NYSE:WAB) recently. As shareholders go into the upcoming AGM on 16th of May, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Westinghouse Air Brake Technologies

How Does Total Compensation For Rafael Santana Compare With Other Companies In The Industry?

At the time of writing, our data shows that Westinghouse Air Brake Technologies Corporation has a market capitalization of US$29b, and reported total annual CEO compensation of US$15m for the year to December 2023. We note that's an increase of 33% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.3m.

In comparison with other companies in the American Machinery industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$12m. This suggests that Rafael Santana is paid more than the median for the industry. Furthermore, Rafael Santana directly owns US$21m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	US$1.3m	US$1.2m	9%
Other	US$14m	US$10m	91%
Total Compensation	US$15m	US$12m	100%

Talking in terms of the industry, salary represented approximately 15% of total compensation out of all the companies we analyzed, while other remuneration made up 85% of the pie. It's interesting to note that Westinghouse Air Brake Technologies allocates a smaller portion of compensation to salary 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.

Westinghouse Air Brake Technologies Corporation's Growth

Westinghouse Air Brake Technologies Corporation has seen its earnings per share (EPS) increase by 34% a year over the past three years. Its revenue is up 16% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. 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 Westinghouse Air Brake Technologies Corporation Been A Good Investment?

Most shareholders would probably be pleased with Westinghouse Air Brake Technologies Corporation for providing a total return of 116% over three years. 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.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Westinghouse Air Brake Technologies that investors should think about before committing capital to this stock.

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

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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.