Yahoo Finance Here's Why Shareholders Will Not Be Complaining About Coterra Energy Inc.'s (NYSE:CTRA) CEO Pay Packet
Key Insights
Coterra Energy to hold its Annual General Meeting on 1st of May
CEO Tom Jorden's total compensation includes salary of US$1.13m
The total compensation is similar to the average for the industry
Coterra Energy's EPS grew by 62% over the past three years while total shareholder return over the past three years was 104%
The performance at Coterra Energy Inc. (NYSE:CTRA) has been quite strong recently and CEO Tom Jorden has played a role in it. Coming up to the next AGM on 1st of May, shareholders would be keeping this in mind. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.
See our latest analysis for Coterra Energy
Comparing Coterra Energy Inc.'s CEO Compensation With The Industry
At the time of writing, our data shows that Coterra Energy Inc. has a market capitalization of US$21b, and reported total annual CEO compensation of US$15m for the year to December 2023. That's a slight decrease of 4.9% on the prior year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.1m.
On comparing similar companies in the American Oil and Gas industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$15m. This suggests that Coterra Energy remunerates its CEO largely in line with the industry average. Furthermore, Tom Jorden directly owns US$55m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.1m | US$1.1m | 8% |
Other | US$13m | US$14m | 92% |
Total Compensation | US$15m | US$15m | 100% |
On an industry level, around 13% of total compensation represents salary and 87% is other remuneration. Coterra Energy pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Coterra Energy Inc.'s Growth Numbers
Coterra Energy Inc. has seen its earnings per share (EPS) increase by 62% a year over the past three years. In the last year, its revenue is down 40%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Coterra Energy Inc. Been A Good Investment?
Boasting a total shareholder return of 104% over three years, Coterra Energy Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term 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 3 warning signs for Coterra Energy that investors should be aware of in a dynamic business environment.
Switching gears from Coterra Energy, 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. 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.
