Yahoo Finance Why Michael Kors Holdings Limited’s (NYSE:KORS) CEO Pay Matters To You
John Idol became the CEO of Michael Kors Holdings Limited (NYSE:KORS) in 2003. 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. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Michael Kors Holdings
How Does John Idol’s Compensation Compare With Similar Sized Companies?
Our data indicates that Michael Kors Holdings Limited is worth US$7.5b, and total annual CEO compensation is US$8m. That’s below the compensation, last year. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12.0b. The median total CEO compensation was US$7m.
So John Idol receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.
You can see, below, how CEO compensation at Michael Kors Holdings has changed over time.
Is Michael Kors Holdings Limited Growing?
Michael Kors Holdings Limited has reduced its earnings per share by an average of 6.3% a year, over the last three years. Its revenue is up 12% over last year.
Unfortunately, earnings per share have trended lower over the last three years. And while it’s good to see some good revenue growth recently, the growth isn’t really fast enough for me to put aside my concerns around earnings. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.
You might want to check this free visual report on analyst forecasts for future earnings.
Has Michael Kors Holdings Limited Been A Good Investment?
Michael Kors Holdings Limited has served shareholders reasonably well, with a total return of 17% over three years. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.
In Summary…
John Idol is paid around the same as most CEOs of similar size companies.
The company isn’t growing earnings per share, and nor have the total returns inspired us. We’re not saying the CEO pay is too generous, but one might argue that the company should improve returns to shareholders before increasing it. So you may want to check if insiders are buying Michael Kors Holdings Limited shares with their own money (free access).
Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.