How Does Duke Realty's (NYSE:DRE) CEO Salary Compare to Peers?

Simply Wall St
October 12, 2020

Jim Connor has been the CEO of Duke Realty Corporation (NYSE:DRE) since 2016, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Duke Realty pays its CEO appropriately, considering its funds from operations growth and total shareholder returns.

Check out our latest analysis for Duke Realty

How Does Total Compensation For Jim Connor Compare With Other Companies In The Industry?

Our data indicates that Duke Realty Corporation has a market capitalization of US$15b, and total annual CEO compensation was reported as US$6.7m for the year to December 2019. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$878k.

On comparing similar companies in the industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$7.2m. So it looks like Duke Realty compensates Jim Connor in line with the median for the industry. What's more, Jim Connor holds US$7.3m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component20192018Proportion (2019)
Salary US$878k US$846k 13%
Other US$5.8m US$6.0m 87%
Total CompensationUS$6.7m US$6.9m100%

On an industry level, roughly 15% of total compensation represents salary and 85% is other remuneration. It's interesting to note that Duke Realty 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.

NYSE:DRE CEO Compensation October 12th 2020

A Look at Duke Realty Corporation's Growth Numbers

Duke Realty Corporation has seen its funds from operations (FFO) increase by 2.0% per year over the past three years. In the last year, its revenue is down 6.4%.

We would prefer it if there was revenue growth, but the modest FFOgrowth gives us some relief. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Duke Realty Corporation Been A Good Investment?

Most shareholders would probably be pleased with Duke Realty Corporation for providing a total return of 54% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

As we touched on above, Duke Realty Corporation is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, the company's FFO growth numbers over the last three years is not that impressive. On the other hand, shareholder returns over the same period have been very healthy. We would like to see FFO growth from the business, although we wouldn't say the CEO compensation is high.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 4 warning signs for Duke Realty (1 can't be ignored!) 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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