Shareholders Will Probably Not Have Any Issues With PPL Corporation's (NYSE:PPL) CEO Compensation

Key Insights

• PPL will host its Annual General Meeting on 15th of May
• Total pay for CEO Vince Sorgi includes US$1.20m salary
• Total compensation is similar to the industry average
• Over the past three years, PPL's EPS grew by 7.6% and over the past three years, the total shareholder return was 11%

CEO Vince Sorgi has done a decent job of delivering relatively good performance at PPL Corporation (NYSE:PPL) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 15th of May. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

View our latest analysis for PPL

Comparing PPL Corporation's CEO Compensation With The Industry

Our data indicates that PPL Corporation has a market capitalization of US$21b, and total annual CEO compensation was reported as US$12m for the year to December 2023. We note that's an increase of 31% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.2m.

For comparison, other companies in the American Electric Utilities industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$14m. From this we gather that Vince Sorgi is paid around the median for CEOs in the industry. Moreover, Vince Sorgi also holds US$9.2m worth of PPL stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	US$1.2m	US$1.2m	10%
Other	US$11m	US$8.0m	90%
Total Compensation	US$12m	US$9.1m	100%

On an industry level, roughly 11% of total compensation represents salary and 89% is other remuneration. There isn't a significant difference between PPL and the broader market, in terms of salary allocation in the overall compensation package. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at PPL Corporation's Growth Numbers

PPL Corporation has seen its earnings per share (EPS) increase by 7.6% a year over the past three years. Its revenue is down 3.9% over the previous year.

We would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see a modest EPS growth at least. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has PPL Corporation Been A Good Investment?

PPL Corporation has served shareholders reasonably well, with a total return of 11% over three years. 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.

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.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. In our study, we found 3 warning signs for PPL you should be aware of, and 2 of them are a bit concerning.

Important note: PPL 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.