Yahoo Finance How Much is Waters Corporation's (NYSE:WAT) CEO Getting Paid?
Chris O'Connell has been the CEO of Waters Corporation (NYSE:WAT) since 2015. This analysis aims first to contrast CEO compensation with other large companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for Waters
How Does Chris O'Connell's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Waters Corporation has a market cap of US$12b, and reported total annual CEO compensation of US$1.1m for the year to December 2019. That's actually a decrease on the year before. While we always look at total compensation first, we note that the salary component is less, at US$945k. We took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO total compensation to be US$12m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On an industry level, roughly 16% of total compensation represents salary and 84% is other remuneration. It's interesting to note that Waters pays out a greater portion of remuneration through salary, in comparison to the wider industry.
This would give shareholders a good impression of the company, since most large companies pay more, leaving less for shareholders. Though positive, it's important we delve into the performance of the actual business. The graphic below shows how CEO compensation at Waters has changed from year to year.
Is Waters Corporation Growing?
Over the last three years Waters Corporation has seen earnings per share (EPS) move in a positive direction by an average of 29% per year (using a line of best fit). It saw its revenue drop 1.9% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Waters Corporation Been A Good Investment?
Waters Corporation has generated a total shareholder return of 7.5% over three years, so most shareholders wouldn't be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
It appears that Waters Corporation remunerates its CEO below most large companies.
Since the business is growing, many would argue this suggests the pay is modest. While returns over the last few years haven't been top notch, there is nothing to suggest to us that Chris O'Connell is overcompensated. Few would complain about reasonable CEO remuneration when the business is growing earnings per share. But it would be nice if insiders were also buying shares. Looking into other areas, we've picked out 1 warning sign for Waters that investors should think about before committing capital to this stock.
Important note: Waters may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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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. Thank you for reading.
