Yahoo Finance Shareholders May Be More Conservative With United Rentals, Inc.'s (NYSE:URI) CEO Compensation For Now
Key Insights
United Rentals will host its Annual General Meeting on 9th of May
Total pay for CEO Matt Flannery includes US$1.09m salary
Total compensation is 40% above industry average
United Rentals' EPS grew by 44% over the past three years while total shareholder return over the past three years was 97%
Under the guidance of CEO Matt Flannery, United Rentals, Inc. (NYSE:URI) has performed reasonably well recently. As shareholders go into the upcoming AGM on 9th of May, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.
View our latest analysis for United Rentals
Comparing United Rentals, Inc.'s CEO Compensation With The Industry
At the time of writing, our data shows that United Rentals, Inc. has a market capitalization of US$44b, and reported total annual CEO compensation of US$11m for the year to December 2023. We note that's a decrease of 11% compared to last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.1m.
In comparison with other companies in the American Trade Distributors industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$7.9m. Accordingly, our analysis reveals that United Rentals, Inc. pays Matt Flannery north of the industry median. Furthermore, Matt Flannery directly owns US$71m 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$1.0m | 10% |
Other | US$9.9m | US$11m | 90% |
Total Compensation | US$11m | US$12m | 100% |
Talking in terms of the industry, salary represented approximately 17% of total compensation out of all the companies we analyzed, while other remuneration made up 83% of the pie. United Rentals pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
United Rentals, Inc.'s Growth
United Rentals, Inc.'s earnings per share (EPS) grew 44% per year over the last three years. In the last year, its revenue is up 17%.
Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. 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 United Rentals, Inc. Been A Good Investment?
Most shareholders would probably be pleased with United Rentals, Inc. for providing a total return of 97% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 2 warning signs for United Rentals that investors should be aware of in a dynamic business environment.
Important note: United Rentals 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.
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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.
