Yahoo Finance We Think Shareholders Are Less Likely To Approve A Large Pay Rise For The PNC Financial Services Group, Inc.'s (NYSE:PNC) CEO For Now
Key Insights
PNC Financial Services Group to hold its Annual General Meeting on 24th of April
CEO Bill Demchak's total compensation includes salary of US$1.20m
The total compensation is 80% higher than the average for the industry
PNC Financial Services Group's EPS grew by 11% over the past three years while total shareholder loss over the past three years was 5.9%
As many shareholders of The PNC Financial Services Group, Inc. (NYSE:PNC) will be aware, they have not made a gain on their investment in the past three years. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 24th of April. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.
Check out our latest analysis for PNC Financial Services Group
How Does Total Compensation For Bill Demchak Compare With Other Companies In The Industry?
According to our data, The PNC Financial Services Group, Inc. has a market capitalization of US$58b, and paid its CEO total annual compensation worth US$20m over the year to December 2023. This means that the compensation hasn't changed much from last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.
In comparison with other companies in the American Banks industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$11m. Hence, we can conclude that Bill Demchak is remunerated higher than the industry median. What's more, Bill Demchak holds US$84m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.2m | US$1.2m | 6% |
Other | US$19m | US$18m | 94% |
Total Compensation | US$20m | US$19m | 100% |
On an industry level, roughly 45% of total compensation represents salary and 55% is other remuneration. In PNC Financial Services Group's case, non-salary compensation represents a greater slice of total remuneration, in comparison 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.
A Look at The PNC Financial Services Group, Inc.'s Growth Numbers
Over the past three years, The PNC Financial Services Group, Inc. has seen its earnings per share (EPS) grow by 11% per year. It saw its revenue drop 3.5% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has The PNC Financial Services Group, Inc. Been A Good Investment?
Since shareholders would have lost about 5.9% over three years, some The PNC Financial Services Group, Inc. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.
CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling PNC Financial Services Group (free visualization of insider trades).
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.
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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.
