Yahoo Finance Constellation Brands, Inc.'s (NYSE:STZ) CEO Compensation Looks Acceptable To Us And Here's Why
Key Insights
Constellation Brands' Annual General Meeting to take place on 17th of July
Salary of US$1.35m is part of CEO Bill Newlands's total remuneration
The total compensation is similar to the average for the industry
Constellation Brands' EPS grew by 27% over the past three years while total shareholder return over the past three years was 17%
Under the guidance of CEO Bill Newlands, Constellation Brands, Inc. (NYSE:STZ) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 17th of July. Here is our take on why we think the CEO compensation looks appropriate.
Check out our latest analysis for Constellation Brands
How Does Total Compensation For Bill Newlands Compare With Other Companies In The Industry?
At the time of writing, our data shows that Constellation Brands, Inc. has a market capitalization of US$46b, and reported total annual CEO compensation of US$15m for the year to February 2024. Notably, that's a decrease of 9.0% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.4m.
For comparison, other companies in the American Beverage industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$18m. This suggests that Constellation Brands remunerates its CEO largely in line with the industry average. Moreover, Bill Newlands also holds US$3.7m worth of Constellation Brands stock directly under their own name.
Component | 2024 | 2023 | Proportion (2024) |
Salary | US$1.4m | US$1.3m | 9% |
Other | US$13m | US$15m | 91% |
Total Compensation | US$15m | US$16m | 100% |
Talking in terms of the industry, salary represented approximately 12% of total compensation out of all the companies we analyzed, while other remuneration made up 88% of the pie. Constellation Brands sets aside a smaller share of compensation for 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.
Constellation Brands, Inc.'s Growth
Over the past three years, Constellation Brands, Inc. has seen its earnings per share (EPS) grow by 27% per year. It achieved revenue growth of 5.3% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Constellation Brands, Inc. Been A Good Investment?
Constellation Brands, Inc. has generated a total shareholder return of 17% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 3 warning signs for Constellation Brands that investors should think about before committing capital to this stock.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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