We have been pretty impressed with the performance at Fidelity National Financial, Inc. (NYSE:FNF) recently and CEO Randy Quirk deserves a mention for their role in it. Coming up to the next AGM on 16 June 2021, shareholders would be keeping this in mind. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.
How Does Total Compensation For Randy Quirk Compare With Other Companies In The Industry?
At the time of writing, our data shows that Fidelity National Financial, Inc. has a market capitalization of US$14b, and reported total annual CEO compensation of US$9.7m for the year to December 2020. This means that the compensation hasn't changed much from last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$888k.
For comparison, other companies in the industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$11m. This suggests that Fidelity National Financial remunerates its CEO largely in line with the industry average. Furthermore, Randy Quirk directly owns US$90m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, around 18% of total compensation represents salary and 82% is other remuneration. It's interesting to note that Fidelity National Financial allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Fidelity National Financial, Inc.'s Growth Numbers
Over the past three years, Fidelity National Financial, Inc. has seen its earnings per share (EPS) grow by 53% per year. Its revenue is up 47% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Fidelity National Financial, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Fidelity National Financial, Inc. for providing a total return of 36% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.
CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 3 warning signs for Fidelity National Financial (of which 1 is a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.
Switching gears from Fidelity National Financial, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
When trading Fidelity National Financial or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account.
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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.