Yahoo Finance This Is Why Morguard North American Residential Real Estate Investment Trust's (TSE:MRG.UN) CEO Can Expect A Bump Up In Their Pay Packet
The decent performance at Morguard North American Residential Real Estate Investment Trust (TSE:MRG.UN) recently will please most shareholders as they go into the AGM coming up on 05 May 2021. The focus will probably be on the future strategic initiatives that the board and management will put in place to improve the business rather than executive remuneration when they cast their votes on company resolutions. In our analysis below, we discuss why we think the CEO compensation looks acceptable and the case for a raise.
See our latest analysis for Morguard North American Residential Real Estate Investment Trust
Comparing Morguard North American Residential Real Estate Investment Trust's CEO Compensation With the industry
At the time of writing, our data shows that Morguard North American Residential Real Estate Investment Trust has a market capitalization of CA$878m, and reported total annual CEO compensation of CA$514k for the year to December 2020. We note that's a decrease of 14% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CA$238k.
For comparison, other companies in the same industry with market capitalizations ranging between CA$495m and CA$2.0b had a median total CEO compensation of CA$1.9m. Accordingly, Morguard North American Residential Real Estate Investment Trust pays its CEO under the industry median. Moreover, Kuldip Sahi also holds CA$11m worth of Morguard North American Residential Real Estate Investment Trust stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2020 | 2019 | Proportion (2020) |
Salary | CA$238k | CA$232k | 46% |
Other | CA$276k | CA$366k | 54% |
Total Compensation | CA$514k | CA$598k | 100% |
Speaking on an industry level, nearly 33% of total compensation represents salary, while the remainder of 67% is other remuneration. Morguard North American Residential Real Estate Investment Trust is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Morguard North American Residential Real Estate Investment Trust's Growth Numbers
Morguard North American Residential Real Estate Investment Trust's funds from operations (FFO) grew 4.9% per yearover the last three years. It saw its revenue drop 2.8% over the last year.
We would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see a modest FFO growth at least. It's hard to reach a conclusion about business performance right now. This may be one to watch. 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 Morguard North American Residential Real Estate Investment Trust Been A Good Investment?
With a total shareholder return of 27% over three years, Morguard North American Residential Real Estate Investment Trust shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
To Conclude...
The company's overall performance, while not bad, could be better. If it manages to keep up the current streak, CEO remuneration could well be one of shareholders' least concerns. Rather, investors would more likely want to engage on discussions related to key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for Morguard North American Residential Real Estate Investment Trust (of which 1 makes us a bit uncomfortable!) that you should know about in order to have a holistic understanding of the stock.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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. 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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