Is Greif Inc’s (NYSE:GEF) CEO Overpaid Relative To Its Peers?

In 2015 Pete Watson was appointed CEO of Greif Inc (NYSE:GEF). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

See our latest analysis for Greif

How Does Pete Watson’s Compensation Compare With Similar Sized Companies?

According to our data, Greif Inc has a market capitalization of US$2.4b, and pays its CEO total annual compensation worth US$5m. That’s a notable increase of 32% on last year. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO compensation was US$5m.

So Pete Watson receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at Greif, below.

NYSE:GEF CEO Compensation November 7th 18
NYSE:GEF CEO Compensation November 7th 18

Is Greif Inc Growing?

On average over the last three years, Greif Inc has grown earnings per share (EPS) by 47% each year. It achieved revenue growth of 8.9% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably.

You might want to check this free visual report on analyst forecasts for future earnings.

Has Greif Inc Been A Good Investment?

Most shareholders would probably be pleased with Greif Inc for providing a total return of 68% over three years. So they may not be at all concerned if the CEO is paid more than is normal for companies around the same size.

In Summary…

Pete Watson is paid around what is normal the leaders of comparable size companies.

Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Indeed, many might consider the pay rather modest, given the solid company performance! Whatever your view on compensation, you might want to check if insiders are buying or selling Greif Inc shares (free trial).

Or you might prefer this data-rich interactive visualization of historic revenue and earnings.

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.