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Marc Lautenbach became the CEO of Pitney Bowes Inc. (NYSE:PBI) in 2012. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Marc Lautenbach's Compensation Compare With Similar Sized Companies?
According to our data, Pitney Bowes Inc. has a market capitalization of US$761m, and pays its CEO total annual compensation worth US$8.1m. (This number is for the twelve months until December 2018). Notably, that's an increase of 27% over the year before. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$992k. When we examined a selection of companies with market caps ranging from US$400m to US$1.6b, we found the median CEO total compensation was US$2.7m.
Thus we can conclude that Marc Lautenbach receives more in total compensation than the median of a group of companies in the same market, and of similar size to Pitney Bowes Inc.. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Pitney Bowes has changed from year to year.
Is Pitney Bowes Inc. Growing?
On average over the last three years, Pitney Bowes Inc. has shrunk earnings per share by 11% each year (measured with a line of best fit). Its revenue is up 6.6% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.
Has Pitney Bowes Inc. Been A Good Investment?
With a three year total loss of 73%, Pitney Bowes Inc. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by Pitney Bowes Inc., and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
Over the same period, investors would have come away with nothing in the way of share price gains. Notably, the CEO remuneration is actually up on last year. In our opinion the CEO might be paid too generously! So you may want to check if insiders are buying Pitney Bowes shares with their own money (free access).
If you want to buy a stock that is better than Pitney Bowes, this free list of high return, low debt companies is a great place to look.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.