Yahoo Finance Most Shareholders Will Probably Find That The Compensation For Montrose Environmental Group, Inc.'s (NYSE:MEG) CEO Is Reasonable
Key Insights
Montrose Environmental Group to hold its Annual General Meeting on 7th of May
Salary of US$775.0k is part of CEO Vijay Manthripragada's total remuneration
The overall pay is 58% below the industry average
Montrose Environmental Group's three-year loss to shareholders was 25% while its EPS grew by 45% over the past three years
Performance at Montrose Environmental Group, Inc. (NYSE:MEG) has been rather uninspiring recently and shareholders may be wondering how CEO Vijay Manthripragada plans to fix this. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 7th of May. It has been shown that setting appropriate executive remuneration incentivises the management to act in the interests of shareholders. We have prepared some analysis below to show that CEO compensation looks to be reasonable.
Check out our latest analysis for Montrose Environmental Group
How Does Total Compensation For Vijay Manthripragada Compare With Other Companies In The Industry?
At the time of writing, our data shows that Montrose Environmental Group, Inc. has a market capitalization of US$1.5b, and reported total annual CEO compensation of US$1.9m for the year to December 2023. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$775k.
On comparing similar companies from the American Commercial Services industry with market caps ranging from US$1.0b to US$3.2b, we found that the median CEO total compensation was US$4.6m. In other words, Montrose Environmental Group pays its CEO lower than the industry median. Moreover, Vijay Manthripragada also holds US$561k worth of Montrose Environmental Group stock directly under their own name.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$775k | US$775k | 40% |
Other | US$1.1m | US$1.2m | 60% |
Total Compensation | US$1.9m | US$2.0m | 100% |
On an industry level, around 23% of total compensation represents salary and 77% is other remuneration. Montrose Environmental Group is paying a higher share of its remuneration through a salary in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
Montrose Environmental Group, Inc.'s Growth
Montrose Environmental Group, Inc.'s earnings per share (EPS) grew 45% per year over the last three years. It achieved revenue growth of 15% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Montrose Environmental Group, Inc. Been A Good Investment?
Since shareholders would have lost about 25% over three years, some Montrose Environmental Group, Inc. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
To Conclude...
The fact that shareholders are sitting on a loss is certainly disheartening. The share price trend has diverged with the robust growth in EPS however, suggesting there may be other factors that could be driving the price performance. There needs to be more focus by management and the board to examine why the share price has diverged from fundamentals. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board’s judgement and decision-making is aligned with their expectations.
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. We did our research and spotted 3 warning signs for Montrose Environmental Group that investors should look into moving forward.
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.
