How Should Investors Feel About Monmouth Real Estate Investment Corporation’s (NYSE:MNR) CEO Pay?

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Michael Landy became the CEO of Monmouth Real Estate Investment Corporation (NYSE:MNR) in 2013. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Monmouth Real Estate Investment

How Does Michael Landy’s Compensation Compare With Similar Sized Companies?

According to our data, Monmouth Real Estate Investment Corporation has a market capitalization of US$1.3b, and pays its CEO total annual compensation worth US$1.5m. (This is based on the year to 2018). That’s a notable increase of 42% on last year. While we always look at total compensation first, we note that the salary component is less, at US$788k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$1.0b to US$3.2b. The median total CEO compensation was US$3.4m.

Most shareholders would consider it a positive that Michael Landy takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it’s important we delve into the performance of the actual business.

The graphic below shows how CEO compensation at Monmouth Real Estate Investment has changed from year to year.

NYSE:MNR CEO Compensation February 5th 19
NYSE:MNR CEO Compensation February 5th 19

Is Monmouth Real Estate Investment Corporation Growing?

Monmouth Real Estate Investment Corporation has increased its earnings per share (EPS) by an average of 16% a year, over the last three years (using a line of best fit). It achieved revenue growth of 20% over the last year.

This demonstrates that the company has been improving recently. A good result. It’s a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Monmouth Real Estate Investment Corporation Been A Good Investment?

Most shareholders would probably be pleased with Monmouth Real Estate Investment Corporation for providing a total return of 53% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary…

It appears that Monmouth Real Estate Investment Corporation remunerates its CEO below most similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. The pleasing shareholder returns are the cherry on top; you might even consider that Michael Landy deserves a raise!

It is relatively rare to see a modestly paid CEO when performance is so impressive. It would be even more positive if company insiders are buying shares. So you may want to check if insiders are buying Monmouth Real Estate Investment shares with their own money (free access).

If you want to buy a stock that is better than Monmouth Real Estate Investment, this free list of high return, low debt companies is a great place to look.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.