Yahoo Finance Increases to BlackRock, Inc.'s (NYSE:BLK) CEO Compensation Might Cool off for now
Key Insights
BlackRock will host its Annual General Meeting on 15th of May
Total pay for CEO Larry Fink includes US$1.50m salary
The total compensation is 59% higher than the average for the industry
Over the past three years, BlackRock's EPS grew by 4.5% and over the past three years, the total loss to shareholders 0.1%
In the past three years, shareholders of BlackRock, Inc. (NYSE:BLK) have seen a loss on their investment. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 15th of May. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.
See our latest analysis for BlackRock
How Does Total Compensation For Larry Fink Compare With Other Companies In The Industry?
Our data indicates that BlackRock, Inc. has a market capitalization of US$116b, and total annual CEO compensation was reported as US$27m for the year to December 2023. That's a notable decrease of 18% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.5m.
For comparison, other companies in the American Capital Markets industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$17m. Hence, we can conclude that Larry Fink is remunerated higher than the industry median. Furthermore, Larry Fink directly owns US$314m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.5m | US$1.5m | 6% |
Other | US$25m | US$31m | 94% |
Total Compensation | US$27m | US$33m | 100% |
Talking in terms of the industry, salary represented approximately 10% of total compensation out of all the companies we analyzed, while other remuneration made up 90% of the pie. BlackRock sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
BlackRock, Inc.'s Growth
BlackRock, Inc. has seen its earnings per share (EPS) increase by 4.5% a year over the past three years. In the last year, its revenue is up 5.3%.
We're not particularly impressed by the revenue growth, but the modest improvement in EPS is good. So there are some positives here, but not enough to earn high praise. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has BlackRock, Inc. Been A Good Investment?
Since shareholders would have lost about 0.1% over three years, some BlackRock, Inc. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
To Conclude...
Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 1 warning sign for BlackRock that investors should be aware of in a dynamic business environment.
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.
