Bill Lenehan became the CEO of Four Corners Property Trust, Inc. (NYSE:FCPT) in 2015, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the funds from operations and shareholder returns of the company.
Comparing Four Corners Property Trust, Inc.'s CEO Compensation With the industry
At the time of writing, our data shows that Four Corners Property Trust, Inc. has a market capitalization of US$1.9b, and reported total annual CEO compensation of US$1.9m for the year to December 2019. That's a notable decrease of 31% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$578k.
On examining similar-sized companies in the industry with market capitalizations between US$1.0b and US$3.2b, we discovered that the median CEO total compensation of that group was US$4.6m. Accordingly, Four Corners Property Trust pays its CEO under the industry median. Furthermore, Bill Lenehan directly owns US$8.9m worth of shares in the company, implying that they are deeply invested in the company's success.
Talking in terms of the industry, salary represented approximately 15% of total compensation out of all the companies we analyzed, while other remuneration made up 85% of the pie. According to our research, Four Corners Property Trust has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Four Corners Property Trust, Inc.'s Growth Numbers
Over the past three years, Four Corners Property Trust, Inc. has seen its funds from operations (FFO) grow by 7.8% per year. In the last year, its revenue is up 6.2%.
We'd prefer higher revenue growth, but the modest improvement in FFO is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Four Corners Property Trust, Inc. Been A Good Investment?
Four Corners Property Trust, Inc. has served shareholders reasonably well, with a total return of 14% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
As previously discussed, Bill is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. But, shareholder returns and FFO growth have been unimpressive recently. Therefore, despite CEO compensation being fair by all accounts, shareholders will probably want to see more growth before they decide that Bill deserves a raise.
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. That's why we did our research, and identified 3 warning signs for Four Corners Property Trust (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.
Important note: Four Corners Property Trust is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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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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