Mauricio Gutierrez has been the CEO of NRG Energy, Inc. (NYSE:NRG) since 2015. This analysis aims first to contrast CEO compensation with other large companies. After that, we will consider the growth in the business. 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.
How Does Mauricio Gutierrez's Compensation Compare With Similar Sized Companies?
Our data indicates that NRG Energy, Inc. is worth US$10b, and total annual CEO compensation was reported as US$8.9m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$1.2m. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. When we examined a group of companies with market caps over US$8.0b, we found that their median CEO total compensation was US$11m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
So Mauricio Gutierrez 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 a visual representation of the CEO compensation at NRG Energy, below.
Is NRG Energy, Inc. Growing?
On average over the last three years, NRG Energy, Inc. has grown earnings per share (EPS) by 109% each year (using a line of best fit). Its revenue is up 3.3% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.
Has NRG Energy, Inc. Been A Good Investment?
Boasting a total shareholder return of 214% over three years, NRG Energy, Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Mauricio Gutierrez is paid around what is normal the leaders of larger companies.
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. So you may want to check if insiders are buying NRG Energy shares with their own money (free access).
If you want to buy a stock that is better than NRG Energy, this free list of high return, low debt companies is a great place to look.
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