We Think BrightSpire Capital, Inc.'s (NYSE:BRSP) CEO Compensation Package Needs To Be Put Under A Microscope

Key Insights

• BrightSpire Capital will host its Annual General Meeting on 14th of May
• Total pay for CEO Mike Mazzei includes US$800.0k salary
• The overall pay is 58% above the industry average
• BrightSpire Capital's EPS declined by 109% over the past three years while total shareholder loss over the past three years was 10%

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Shareholders will probably not be too impressed with the underwhelming results at BrightSpire Capital, Inc. (NYSE:BRSP) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 14th of May. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for BrightSpire Capital

Comparing BrightSpire Capital, Inc.'s CEO Compensation With The Industry

According to our data, BrightSpire Capital, Inc. has a market capitalization of US$664m, and paid its CEO total annual compensation worth US$5.8m over the year to December 2024. That is, the compensation was roughly the same as last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$800k.

In comparison with other companies in the American Mortgage REITs industry with market capitalizations ranging from US$400m to US$1.6b, the reported median CEO total compensation was US$3.7m. Hence, we can conclude that Mike Mazzei is remunerated higher than the industry median. Furthermore, Mike Mazzei directly owns US$6.9m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 13% of total compensation represents salary and 87% is other remuneration. Our data reveals that BrightSpire Capital allocates salary more or less in line with the wider market. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

BrightSpire Capital, Inc.'s Growth

Over the last three years, BrightSpire Capital, Inc. has shrunk its earnings per share by 109% per year. In the last year, its revenue is down 15%.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet 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 BrightSpire Capital, Inc. Been A Good Investment?

With a three year total loss of 10% for the shareholders, BrightSpire Capital, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

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 BrightSpire Capital that investors should look into moving forward.

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.