Yahoo Finance This Is Why We Think Red Rock Resorts, Inc.'s (NASDAQ:RRR) CEO Might Get A Pay Rise Approved By Shareholders
Key Insights
Red Rock Resorts' Annual General Meeting to take place on 30th of May
Salary of US$1.00m is part of CEO Frank Fertitta's total remuneration
The overall pay is 67% below the industry average
Red Rock Resorts' total shareholder return over the past three years was 29% while its EPS grew by 24% over the past three years
The decent performance at Red Rock Resorts, Inc. (NASDAQ:RRR) recently will please most shareholders as they go into the AGM coming up on 30th of May. The focus will probably be on the future strategic initiatives that the board and management will put in place to improve the business rather than executive remuneration when they cast their votes on company resolutions. We have prepared some analysis below and we show why we think CEO compensation looks decent with even the possibility for a raise.
See our latest analysis for Red Rock Resorts
Comparing Red Rock Resorts, Inc.'s CEO Compensation With The Industry
Our data indicates that Red Rock Resorts, Inc. has a market capitalization of US$5.1b, and total annual CEO compensation was reported as US$3.5m for the year to December 2023. That's a fairly small increase of 6.8% over the previous year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.0m.
For comparison, other companies in the American Hospitality industry with market capitalizations ranging between US$4.0b and US$12b had a median total CEO compensation of US$11m. Accordingly, Red Rock Resorts pays its CEO under the industry median. Furthermore, Frank Fertitta directly owns US$210m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.0m | US$1.0m | 29% |
Other | US$2.5m | US$2.3m | 71% |
Total Compensation | US$3.5m | US$3.3m | 100% |
Speaking on an industry level, nearly 18% of total compensation represents salary, while the remainder of 82% is other remuneration. It's interesting to note that Red Rock Resorts pays out a greater portion of remuneration through salary, compared to the industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Red Rock Resorts, Inc.'s Growth Numbers
Red Rock Resorts, Inc. has seen its earnings per share (EPS) increase by 24% a year over the past three years. It achieved revenue growth of 4.9% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. 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 Red Rock Resorts, Inc. Been A Good Investment?
With a total shareholder return of 29% over three years, Red Rock Resorts, Inc. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
The company's overall performance, while not bad, could be better. If it manages to keep up the current streak, CEO remuneration could well be one of shareholders' least concerns. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. In our study, we found 2 warning signs for Red Rock Resorts you should be aware of, and 1 of them is a bit concerning.
Important note: Red Rock Resorts is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. 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. 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.
