Shareholders Will Most Likely Find The Ensign Group, Inc.'s (NASDAQ:ENSG) CEO Compensation Acceptable

Key Insights

• Ensign Group will host its Annual General Meeting on 16th of May
• Total pay for CEO Barry Port includes US$517.7k salary
• Total compensation is similar to the industry average
• Ensign Group's EPS grew by 5.1% over the past three years while total shareholder return over the past three years was 43%

Under the guidance of CEO Barry Port, The Ensign Group, Inc. (NASDAQ:ENSG) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 16th of May. Here is our take on why we think the CEO compensation looks appropriate.

View our latest analysis for Ensign Group

Comparing The Ensign Group, Inc.'s CEO Compensation With The Industry

Our data indicates that The Ensign Group, Inc. has a market capitalization of US$6.6b, and total annual CEO compensation was reported as US$11m for the year to December 2023. We note that's an increase of 38% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$518k.

In comparison with other companies in the American Healthcare industry with market capitalizations ranging from US$4.0b to US$12b, the reported median CEO total compensation was US$11m. So it looks like Ensign Group compensates Barry Port in line with the median for the industry. Moreover, Barry Port also holds US$23m worth of Ensign Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	US$518k	US$503k	5%
Other	US$11m	US$7.5m	95%
Total Compensation	US$11m	US$8.0m	100%

On an industry level, around 21% of total compensation represents salary and 79% is other remuneration. Interestingly, the company has chosen to go down an unconventional route in that it pays a smaller salary to Barry Port as compared to non-salary compensation over the one-year period examined. 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 Ensign Group, Inc.'s Growth Numbers

Over the past three years, The Ensign Group, Inc. has seen its earnings per share (EPS) grow by 5.1% per year. Its revenue is up 20% over the last year.

We would argue that the modest growth in revenue is a notable positive. And the modest growth in EPS isn't bad, either. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. 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 The Ensign Group, Inc. Been A Good Investment?

We think that the total shareholder return of 43%, over three years, would leave most The Ensign Group, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Ensign Group primarily uses non-salary benefits to reward its CEO. Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Ensign Group (free visualization of insider trades).

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.