Anthony Malkin became the CEO of Empire State Realty Trust, Inc. (NYSE:ESRT) in 2012. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
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How Does Anthony Malkin’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Empire State Realty Trust, Inc. has a market cap of US$4.8b, and is paying total annual CEO compensation of US$9.3m. (This figure is for the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$810k. 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.
It would therefore appear that Empire State Realty Trust, Inc. pays Anthony Malkin more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Empire State Realty Trust, below.
Is Empire State Realty Trust, Inc. Growing?
On average over the last three years, Empire State Realty Trust, Inc. has grown earnings per share (EPS) by 4.2% each year (using a line of best fit). Its revenue is up 1.3% over last year.
I’d prefer higher revenue growth, but I’m happy with the modest EPS growth. It’s clear the performance has been quite decent, but it it falls short of outstanding,based on this information. You might want to check this free visual report on analyst forecasts for future earnings.
Has Empire State Realty Trust, Inc. Been A Good Investment?
Since shareholders would have lost about 11% over three years, some Empire State Realty Trust, Inc. shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
We examined the amount Empire State Realty Trust, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Shareholders may wish to consider further research. Although we don’t think the CEO pay is too high, it is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Empire State Realty Trust (free visualization of insider trades).
If you want to buy a stock that is better than Empire State Realty Trust, this free list of high return, low debt companies is a great place to look.
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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.