Increases to CEO Compensation Might Be Put On Hold For Now at New Jersey Resources Corporation (NYSE:NJR)

Key Insights

• New Jersey Resources will host its Annual General Meeting on 21st of January
• Total pay for CEO Steve Westhoven includes US$968.4k salary
• Total compensation is 67% above industry average
• New Jersey Resources' total shareholder return over the past three years was 30% while its EPS grew by 33% over the past three years

CEO Steve Westhoven has done a decent job of delivering relatively good performance at New Jersey Resources Corporation (NYSE:NJR) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 21st of January. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for New Jersey Resources

How Does Total Compensation For Steve Westhoven Compare With Other Companies In The Industry?

According to our data, New Jersey Resources Corporation has a market capitalization of US$4.5b, and paid its CEO total annual compensation worth US$7.2m over the year to September 2024. Notably, that's an increase of 25% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$968k.

On comparing similar companies from the American Gas Utilities industry with market caps ranging from US$2.0b to US$6.4b, we found that the median CEO total compensation was US$4.3m. Hence, we can conclude that Steve Westhoven is remunerated higher than the industry median. Moreover, Steve Westhoven also holds US$9.5m worth of New Jersey Resources stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	US$968k	US$929k	13%
Other	US$6.2m	US$4.9m	87%
Total Compensation	US$7.2m	US$5.8m	100%

On an industry level, roughly 22% of total compensation represents salary and 78% is other remuneration. It's interesting to note that New Jersey Resources 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 New Jersey Resources Corporation's Growth Numbers

New Jersey Resources Corporation's earnings per share (EPS) grew 33% per year over the last three years. It saw its revenue drop 8.5% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. 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 New Jersey Resources Corporation Been A Good Investment?

With a total shareholder return of 30% over three years, New Jersey Resources Corporation shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for New Jersey Resources (of which 1 is a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.