Anthony Allott has been the CEO of Silgan Holdings Inc. (NASDAQ:SLGN) since 2006. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
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How Does Anthony Allott’s Compensation Compare With Similar Sized Companies?
Our data indicates that Silgan Holdings Inc. is worth US$3.3b, and total annual CEO compensation is US$3.4m. (This number is for the twelve months until December 2018). We note that’s an increase of 25% above last year. We think total compensation is more important but we note that the CEO salary is lower, at US$1.0m. We examined companies with market caps from US$2.0b to US$6.4b, and discovered that the median CEO total compensation of that group was US$5.2m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Silgan Holdings has changed over time.
Is Silgan Holdings Inc. Growing?
On average over the last three years, Silgan Holdings Inc. has grown earnings per share (EPS) by 27% each year (using a line of best fit). It achieved revenue growth of 3.9% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. It could be important to check this free visual depiction of what analysts expect for the future.
Has Silgan Holdings Inc. Been A Good Investment?
Silgan Holdings Inc. has served shareholders reasonably well, with a total return of 29% over three years. But they probably don’t want to see the CEO paid more than is normal for companies around the same size.
Silgan Holdings Inc. is currently paying its CEO below what is normal for companies of its size. Many would consider this to indicate that the pay is modest since the business is growing. The total shareholder return might not be amazing, but that doesn’t mean that Anthony Allott is paid too much.
It’s good to see reasonable payment of the CEO, even while the business improves. But for me, it’s even better if insiders are also buying shares with their own cold, hard, cash. Whatever your view on compensation, you might want to check if insiders are buying or selling Silgan Holdings shares (free trial).
Important note: Silgan Holdings may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.