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In 2009 Damon Hininger was appointed CEO of CoreCivic, Inc. (NYSE:CXW). 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Damon Hininger’s Compensation Compare With Similar Sized Companies?
Our data indicates that CoreCivic, Inc. is worth US$2.6b, and total annual CEO compensation is US$4.1m. (This number is for the twelve months until December 2018). We note that’s an increase of 73% above last year. While we always look at total compensation first, we note that the salary component is less, at US$926k. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$5.3m.
That means Damon Hininger receives fairly typical remuneration for the CEO of a company that size. 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 CoreCivic, below.
Is CoreCivic, Inc. Growing?
CoreCivic, Inc. has reduced its earnings per share by an average of 12% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 6.7%.
Few shareholders would be pleased to read that earnings per share are lower over three years. And the modest revenue growth over 12 months isn’t much comfort against the reduced earnings per share. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.
Has CoreCivic, Inc. Been A Good Investment?
With a three year total loss of 17%, CoreCivic, Inc. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Damon Hininger is paid around the same as most CEOs of similar size companies.
After looking at EPS and total shareholder returns, it’s certainly hard to argue the company has performed well, since both metrics are down. So shareholders might not feel great about the fact that CEO pay increased on last year. Suffice it to say, we don’t think the CEO is underpaid! Whatever your view on compensation, you might want to check if insiders are buying or selling CoreCivic shares (free trial).
Important note: CoreCivic 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.