We Think The Compensation For Vontier Corporation's (NYSE:VNT) CEO Looks About Right

Key Insights

• Vontier to hold its Annual General Meeting on 28th of May
• CEO Mark Morelli's total compensation includes salary of US$1.07m
• Total compensation is similar to the industry average
• Vontier's total shareholder return over the past three years was 16% while its EPS grew by 2.5% over the past three years

Under the guidance of CEO Mark Morelli, Vontier Corporation (NYSE:VNT) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 28th of May. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

View our latest analysis for Vontier

How Does Total Compensation For Mark Morelli Compare With Other Companies In The Industry?

Our data indicates that Vontier Corporation has a market capitalization of US$6.3b, and total annual CEO compensation was reported as US$9.3m for the year to December 2023. Notably, that's an increase of 47% 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.

For comparison, other companies in the American Electronic industry with market capitalizations ranging between US$4.0b and US$12b had a median total CEO compensation of US$8.9m. So it looks like Vontier compensates Mark Morelli in line with the median for the industry. What's more, Mark Morelli holds US$11m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	US$1.1m	US$1.0m	12%
Other	US$8.3m	US$5.3m	88%
Total Compensation	US$9.3m	US$6.4m	100%

On an industry level, roughly 31% of total compensation represents salary and 69% is other remuneration. It's interesting to note that Vontier allocates a smaller portion of compensation to salary in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Vontier Corporation's Growth Numbers

Vontier Corporation's earnings per share (EPS) grew 2.5% per year over the last three years. It saw its revenue drop 4.3% over the last year.

We generally like to see a little revenue growth, but the modest improvement in EPS is good. It's hard to reach a conclusion about business performance right now. This may be one to watch. 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 Vontier Corporation Been A Good Investment?

With a total shareholder return of 16% over three years, Vontier Corporation shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Vontier that investors should think about before committing capital to this stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.