Does American Financial Group Inc's (NYSE:AFG) CEO Pay Compare Well With Peers?

In 2005 Stephen Lindner was appointed CEO of American Financial Group Inc (NYSE:AFG). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for American Financial Group

How Does Stephen Lindner's Compensation Compare With Similar Sized Companies?

According to our data, American Financial Group Inc has a market capitalization of US$9.2b, and pays its CEO total annual compensation worth US$9.6m. (This number is for the twelve months until 2017). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$1.2m. When we examined a selection of companies with market caps ranging from US$4.0b to US$12b, we found the median CEO compensation was US$6.6m.

As you can see, Stephen Lindner is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean American Financial Group Inc is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

The graphic below shows how CEO compensation at American Financial Group has changed from year to year.

Is American Financial Group Inc Growing?

Over the last three years American Financial Group Inc has grown its earnings per share (EPS) by an average of 18% per year. In the last year, its revenue is up 6.9%.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy.

It could be important to check this free visual depiction of what analysts expect for the future.

Has American Financial Group Inc Been A Good Investment?

Most shareholders would probably be pleased with American Financial Group Inc for providing a total return of 55% over three years. This strong performance might mean some shareholders don't mind if the CEO is paid more than is normal for a company of its size.

In Summary...

We examined the amount American Financial Group Inc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

However, the earnings per share growth over three years is certainly impressive. In addition, shareholders have done well over the same time period. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling American Financial Group (free visualization of insider trades).

Or you might prefer gaze uponthis detailed graph of past earnings, revenue and cash flow .

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.

Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.