Murray Armstrong has been the CEO of The Williams Companies, Inc. (NYSE:WMB) since 2011, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Williams Companies.
How Does Total Compensation For Murray Armstrong Compare With Other Companies In The Industry?
Our data indicates that The Williams Companies, Inc. has a market capitalization of US$23b, and total annual CEO compensation was reported as US$16m for the year to December 2019. That's a notable increase of 46% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.
On comparing similar companies in the industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$13m. So it looks like Williams Companies compensates Murray Armstrong in line with the median for the industry. Moreover, Murray Armstrong also holds US$16m worth of Williams Companies stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Talking in terms of the industry, salary represented approximately 16% of total compensation out of all the companies we analyzed, while other remuneration made up 84% of the pie. Williams Companies pays a modest slice of remuneration through salary, as compared 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.
A Look at The Williams Companies, Inc.'s Growth Numbers
Over the last three years, The Williams Companies, Inc. has shrunk its earnings per share by 43% per year. In the last year, its revenue is down 9.3%.
Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has The Williams Companies, Inc. Been A Good Investment?
Given the total shareholder loss of 21% over three years, many shareholders in The Williams Companies, Inc. are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.
As previously discussed, Murray is compensated close to the median for companies of its size, and which belong to the same industry. On the other hand, EPS growth and total shareholder return have been negative for the last three years. Considering overall performance, shareholders will likely hold off support for a raise until results improve.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 3 warning signs for Williams Companies you should be aware of, and 2 of them are concerning.
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. 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.
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