Our View On Rightmove's (LON:RMV) CEO Pay

This article will reflect on the compensation paid to Peter Brooks-Johnson who has served as CEO of Rightmove plc (LON:RMV) since 2017. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Rightmove.

Check out our latest analysis for Rightmove

How Does Total Compensation For Peter Brooks-Johnson Compare With Other Companies In The Industry?

Our data indicates that Rightmove plc has a market capitalization of UK£5.3b, and total annual CEO compensation was reported as UK£2.2m for the year to December 2019. That's a notable increase of 45% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at UK£501k.

In comparison with other companies in the industry with market capitalizations ranging from UK£3.1b to UK£9.4b, the reported median CEO total compensation was UK£1.7m. So it looks like Rightmove compensates Peter Brooks-Johnson in line with the median for the industry. Moreover, Peter Brooks-Johnson also holds UK£12m worth of Rightmove stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 51% of total compensation represents salary, while the remainder of 49% is other remuneration. In Rightmove's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Rightmove plc's Growth

Rightmove plc's earnings per share (EPS) grew 2.0% per year over the last three years. Its revenue is down 14% over the previous year.

We generally like to see a little revenue growth, but the modest EPSgrowth gives us some relief. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Rightmove plc Been A Good Investment?

Boasting a total shareholder return of 56% over three years, Rightmove plc has done well by shareholders. 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 we noted earlier, Rightmove pays its CEO in line with similar-sized companies belonging to the same industry. But the company has been found wanting in terms of EPS growth over the past three years. At the same time, shareholder returns have remained strong over the same period. There is room for improved company performance, but we don't see the CEO compensation as a big issue here.

So you may want to check if insiders are buying Rightmove shares with their own money (free access).

Important note: Rightmove 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.

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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