We think Ryman Hospitality Properties, Inc.'s (NYSE:RHP) CEO May Struggle To See Much Of A Pay Rise This Year

The anaemic share price growth at Ryman Hospitality Properties, Inc. (NYSE:RHP) over the past few years has probably not impressed shareholders and may be due to earnings not growing over that period. Some of these issues will occupy shareholders' minds as the AGM rolls around on 13 May 2021. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

See our latest analysis for Ryman Hospitality Properties

Comparing Ryman Hospitality Properties, Inc.'s CEO Compensation With the industry

At the time of writing, our data shows that Ryman Hospitality Properties, Inc. has a market capitalization of US$4.1b, and reported total annual CEO compensation of US$4.4m for the year to December 2020. Notably, that's a decrease of 28% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.1m.

On examining similar-sized companies in the industry with market capitalizations between US$2.0b and US$6.4b, we discovered that the median CEO total compensation of that group was US$5.4m. So it looks like Ryman Hospitality Properties compensates Colin Reed in line with the median for the industry. What's more, Colin Reed holds US$58m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

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, Ryman Hospitality Properties 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 Ryman Hospitality Properties, Inc.'s Growth Numbers

Ryman Hospitality Properties's funds from operations (FFO) reversed its movement and declined to -US$295m from US$323m last year. In the last year, its revenue is down 81%.

The lack of growth is certainly uninspiring. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Ryman Hospitality Properties, Inc. Been A Good Investment?

Ryman Hospitality Properties, Inc. has generated a total shareholder return of 1.6% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.

In Summary...

The flat share price growth combined with the the fact that earnings have failed to grow makes us wonder whether the share price will have any further strong momentum. Shareholders should make the most of the coming opportunity to question the board on key concerns they may have and revisit their investment thesis with regards to the company.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 2 warning signs (and 1 which shouldn't be ignored) in Ryman Hospitality Properties we think you should know about.

Important note: Ryman Hospitality 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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