Yahoo Finance Is Ally Financial Inc’s (NYSE:ALLY) CEO Incentives Align With Yours?
In 2015 Jeff Brown was appointed CEO of Ally Financial Inc (NYSE:ALLY). First, this article will compare CEO compensation with compensation at other large companies. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
View our latest analysis for Ally Financial
How Does Jeff Brown’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Ally Financial Inc has a market cap of US$10.8b, and is paying total annual CEO compensation of US$9m. Notably, that’s an increase of 17% over the year before. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO compensation was US$11m.
So Jeff Brown is paid around the average of 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, below, how CEO compensation at Ally Financial has changed over time.
Is Ally Financial Inc Growing?
On average over the last three years, Ally Financial Inc has grown earnings per share (EPS) by 97% each year. It saw its revenue drop -3.5% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. While it would be good to see revenue growth, profits matter more in the end.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Ally Financial Inc Been A Good Investment?
Ally Financial Inc has generated a total shareholder return of 27% 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…
Jeff Brown is paid around the same as most CEOs of large companies.
Shareholder returns could be better but shareholders would be pleased with the positive EPS growth. So upon reflection one could argue that the CEO pay is quite reasonable. Shareholders may want to check for free if Ally Financial Inc insiders are buying or selling shares.
Or you might prefer examine intently this intuitive graph showing past earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
