How Much Is InterGroup's (NASDAQ:INTG) CEO Getting Paid?

This article will reflect on the compensation paid to John Winfield who has served as CEO of The InterGroup Corporation (NASDAQ:INTG) since 1987. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for InterGroup

How Does Total Compensation For John Winfield Compare With Other Companies In The Industry?

According to our data, The InterGroup Corporation has a market capitalization of US$82m, and paid its CEO total annual compensation worth US$900k over the year to June 2020. That is, the compensation was roughly the same as last year. Notably, the salary which is US$832.0k, represents most of the total compensation being paid.

For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$246k. Hence, we can conclude that John Winfield is remunerated higher than the industry median. Moreover, John Winfield also holds US$51m worth of InterGroup stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 29% of total compensation represents salary and 71% is other remuneration. It's interesting to note that InterGroup pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at The InterGroup Corporation's Growth Numbers

Over the last three years, The InterGroup Corporation has shrunk its earnings per share by 25% per year. It saw its revenue drop 55% over the last year.

Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has The InterGroup Corporation Been A Good Investment?

We think that the total shareholder return of 57%, over three years, would leave most The InterGroup Corporation shareholders smiling. 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.

To Conclude...

As we touched on above, The InterGroup Corporation is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. We feel that EPS have been a bit disappointing, but it's nice to see positive shareholder returns over the last three years. Considering positive investor returns, it would be bold of us to criticize CEO compensation, but shareholders might want to see healthier EPS growth before a raise is given out.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 5 warning signs for InterGroup (3 don't sit too well with us!) that you should be aware of before investing here.

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.

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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.
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