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Is Performance Food Group Company (NYSE:PFGC) Excessively Paying Its CEO?

Simply Wall St

In 2002 George Holm was appointed CEO of Performance Food Group Company (NYSE:PFGC). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. 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.

View our latest analysis for Performance Food Group

How Does George Holm's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Performance Food Group Company has a market cap of US$5.5b, and reported total annual CEO compensation of US$6.1m for the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at US$1.0m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12b. The median total CEO compensation was US$6.5m.

That means George Holm receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at Performance Food Group, below.

NYSE:PFGC CEO Compensation, January 7th 2020

Is Performance Food Group Company Growing?

Over the last three years Performance Food Group Company has grown its earnings per share (EPS) by an average of 28% per year (using a line of best fit). It achieved revenue growth of 21% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Performance Food Group Company Been A Good Investment?

I think that the total shareholder return of 118%, over three years, would leave most Performance Food Group Company shareholders smiling. 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...

Remuneration for George Holm is close enough to the median pay for a CEO of a similar sized company .

The company is growing earnings per share and total shareholder returns have been pleasing. Indeed, many might consider the pay rather modest, given the solid company performance! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Performance Food Group.

Important note: Performance Food Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.

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. Thank you for reading.