How Should Investors Feel About Dream Industrial Real Estate Investment Trust's (TSE:DIR.UN) CEO Remuneration?

Brian Pauls became the CEO of Dream Industrial Real Estate Investment Trust (TSE:DIR.UN) in 2018, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Dream Industrial Real Estate Investment Trust.

Check out our latest analysis for Dream Industrial Real Estate Investment Trust

How Does Total Compensation For Brian Pauls Compare With Other Companies In The Industry?

According to our data, Dream Industrial Real Estate Investment Trust has a market capitalization of CA$1.7b, and paid its CEO total annual compensation worth CA$1.1m over the year to December 2019. Notably, that's an increase of 78% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CA$360k.

For comparison, other companies in the same industry with market capitalizations ranging between CA$1.3b and CA$4.3b had a median total CEO compensation of CA$1.8m. Accordingly, Dream Industrial Real Estate Investment Trust pays its CEO under the industry median. Furthermore, Brian Pauls directly owns CA$366k worth of shares in the company.

Talking in terms of the industry, salary represented approximately 33% of total compensation out of all the companies we analyzed, while other remuneration made up 67% of the pie. Dream Industrial Real Estate Investment Trust is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Dream Industrial Real Estate Investment Trust's Growth Numbers

Dream Industrial Real Estate Investment Trust's earnings per share (EPS) grew 104% per year over the last three years. It achieved revenue growth of 23% 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. 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 Dream Industrial Real Estate Investment Trust Been A Good Investment?

Most shareholders would probably be pleased with Dream Industrial Real Estate Investment Trust for providing a total return of 55% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

As previously discussed, Brian is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. Since earnings growth is heading in a positive direction; many would agree with our assessment that the pay is modest. Given the strong history of shareholder returns, the shareholders are probably very happy with Brian's performance.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 5 warning signs (and 2 which make us uncomfortable) in Dream Industrial Real Estate Investment Trust we think you should know about.

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.

This article by Simply Wall St is general in nature. 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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