A Quick Analysis On National Retail Properties' (NYSE:NNN) CEO Salary

Jay Whitehurst has been the CEO of National Retail Properties, Inc. (NYSE:NNN) since 2017, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the funds from operations and shareholder returns of the company.

Check out our latest analysis for National Retail Properties

Comparing National Retail Properties, Inc.'s CEO Compensation With the industry

Our data indicates that National Retail Properties, Inc. has a market capitalization of US$7.2b, and total annual CEO compensation was reported as US$6.3m for the year to December 2019. That's a notable increase of 29% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$825k.

For comparison, other companies in the same industry with market capitalizations ranging between US$4.0b and US$12b had a median total CEO compensation of US$6.0m. So it looks like National Retail Properties compensates Jay Whitehurst in line with the median for the industry. Moreover, Jay Whitehurst also holds US$19m worth of National Retail Properties stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 15% of total compensation represents salary and 85% is other remuneration. In National Retail Properties' case, non-salary compensation represents a greater slice of total remuneration, 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.

National Retail Properties, Inc.'s Growth

Over the past three years, National Retail Properties, Inc. has seen its funds from operations (FFO) grow by 11% per year. It achieved revenue growth of 2.2% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has National Retail Properties, Inc. Been A Good Investment?

With a total shareholder return of 11% over three years, National Retail Properties, Inc. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

As we noted earlier, National Retail Properties pays its CEO in line with similar-sized companies belonging to the same industry. But FFO growth for the company has been strong over the last three years, though shareholder returns in comparison haven't been as impressive. As a result of these considerations, we would suggest the compensation is reasonable, but looking ahead shareholders will likely want to see healthier returns.

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. We identified 2 warning signs for National Retail Properties (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

Important note: National Retail Properties 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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