How Much is iStar's (NYSE:STAR) CEO Getting Paid?

Jay Sugarman has been the CEO of iStar Inc. (NYSE:STAR) since 1997, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for iStar.

Note: The company does not report funds from operations, and as a result, we have used earnings per share in our analysis.

View our latest analysis for iStar

How Does Total Compensation For Jay Sugarman Compare With Other Companies In The Industry?

At the time of writing, our data shows that iStar Inc. has a market capitalization of US$1.1b, and reported total annual CEO compensation of US$4.4m for the year to December 2019. We note that's a decrease of 27% compared to last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.0m.

In comparison with other companies in the industry with market capitalizations ranging from US$400m to US$1.6b, the reported median CEO total compensation was US$2.1m. This suggests that Jay Sugarman is paid more than the median for the industry. Furthermore, Jay Sugarman directly owns US$39m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2019	2018	Proportion (2019)
Salary	US$1.0m	US$1.0m	23%
Other	US$3.4m	US$5.0m	77%
Total Compensation	US$4.4m	US$6.0m	100%

Speaking on an industry level, nearly 15% of total compensation represents salary, while the remainder of 85% is other remuneration. It's interesting to note that iStar pays out a greater portion of remuneration through salary, compared to the industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

iStar Inc.'s Growth

Over the past three years, iStar Inc. has seen its earnings per share (EPS) grow by 33% per year. In the last year, its revenue is up 8.3%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 iStar Inc. Been A Good Investment?

Most shareholders would probably be pleased with iStar Inc. for providing a total return of 45% 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.

To Conclude...

As previously discussed, Jay is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Importantly though, EPS growth and shareholder returns are very impressive over the last three years. Considering such exceptional results for the company, we'd venture to say CEO compensation is fair. And given most shareholders are probably very happy with recent returns, they might even think that Jay 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. We did our research and identified 3 warning signs (and 1 which shouldn't be ignored) in iStar we think you should know about.

Switching gears from iStar, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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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