Yahoo Finance Should Shareholders Reconsider BrightView Holdings, Inc.'s (NYSE:BV) CEO Compensation Package?
Key Insights
BrightView Holdings to hold its Annual General Meeting on 7th of March
Salary of US$900.0k is part of CEO Andrew Masterman's total remuneration
The total compensation is 111% higher than the average for the industry
Over the past three years, BrightView Holdings' EPS fell by 40% and over the past three years, the total loss to shareholders 57%
BrightView Holdings, Inc. (NYSE:BV) has not performed well recently and CEO Andrew Masterman will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 7th of March. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.
Check out our latest analysis for BrightView Holdings
How Does Total Compensation For Andrew Masterman Compare With Other Companies In The Industry?
Our data indicates that BrightView Holdings, Inc. has a market capitalization of US$591m, and total annual CEO compensation was reported as US$10m for the year to September 2022. Notably, that's an increase of 83% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$900k.
On comparing similar companies from the American Commercial Services industry with market caps ranging from US$200m to US$800m, we found that the median CEO total compensation was US$4.9m. Hence, we can conclude that Andrew Masterman is remunerated higher than the industry median. Moreover, Andrew Masterman also holds US$4.6m worth of BrightView Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2022 | 2021 | Proportion (2022) |
Salary | US$900k | US$850k | 9% |
Other | US$9.5m | US$4.9m | 91% |
Total Compensation | US$10m | US$5.7m | 100% |
On an industry level, around 18% of total compensation represents salary and 82% is other remuneration. In BrightView Holdings' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
BrightView Holdings, Inc.'s Growth
BrightView Holdings, Inc. has reduced its earnings per share by 40% a year over the last three years. In the last year, its revenue is up 9.6%.
Overall this is not a very positive result for shareholders. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has BrightView Holdings, Inc. Been A Good Investment?
Few BrightView Holdings, Inc. shareholders would feel satisfied with the return of -57% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 3 warning signs for BrightView Holdings (of which 1 makes us a bit uncomfortable!) that you should know about in order to have a holistic understanding of the stock.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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