Michael Burke has been the CEO of AECOM (NYSE:ACM) since 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Michael Burke's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that AECOM has a market cap of US$6.8b, and reported total annual CEO compensation of US$16m for the year to September 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$1.5m. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. When we examined a selection of companies with market caps ranging from US$4.0b to US$12b, we found the median CEO total compensation was US$6.8m.
As you can see, Michael Burke is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean AECOM is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at AECOM has changed over time.
Is AECOM Growing?
On average over the last three years, AECOM has grown earnings per share (EPS) by 11% each year (using a line of best fit). It achieved revenue growth of 3.3% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. You might want to check this free visual report on analyst forecasts for future earnings.
Has AECOM Been A Good Investment?
With a total shareholder return of 16% over three years, AECOM shareholders would, in general, be reasonably content. 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.
We compared the total CEO remuneration paid by AECOM, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. Looking at the same time period, we think that the shareholder returns are respectable. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at AECOM.
If you want to buy a stock that is better than AECOM, this free list of high return, low debt companies is a great place to look.
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