Ron Keating has been the CEO of Evoqua Water Technologies Corp. (NYSE:AQUA) since 2014, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Evoqua Water Technologies.
View our latest analysis for Evoqua Water Technologies
How Does Total Compensation For Ron Keating Compare With Other Companies In The Industry?
At the time of writing, our data shows that Evoqua Water Technologies Corp. has a market capitalization of US$3.6b, and reported total annual CEO compensation of US$5.7m for the year to September 2020. That's a notable increase of 72% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$862k.
For comparison, other companies in the same industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$5.6m. So it looks like Evoqua Water Technologies compensates Ron Keating in line with the median for the industry. Furthermore, Ron Keating directly owns US$11m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | US$862k | US$827k | 15% |
| Other | US$4.8m | US$2.5m | 85% |
| Total Compensation | US$5.7m | US$3.3m | 100% |
On an industry level, around 17% of total compensation represents salary and 83% is other remuneration. Although there is a difference in how total compensation is set, Evoqua Water Technologies more or less reflects the market in terms of setting the salary. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Evoqua Water Technologies Corp.'s Growth Numbers
Over the past three years, Evoqua Water Technologies Corp. has seen its earnings per share (EPS) grow by 262% per year. In the last year, its revenue is down 1.1%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Evoqua Water Technologies Corp. Been A Good Investment?
Evoqua Water Technologies Corp. has generated a total shareholder return of 21% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
In Summary...
As previously discussed, Ron is compensated close to the median for companies of its size, and which belong to the same industry. But EPS growth for the company has been strong over the last three years, though shareholder returns in comparison haven't been as impressive. So considering these factors, we think the compensation is probably quite reasonable, but investor returns need a boost moving forward.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for Evoqua Water Technologies (2 are a bit unpleasant!) that you should be aware of before investing here.
Important note: Evoqua Water Technologies 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. 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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How Much Is Evoqua Water Technologies Corp. (NYSE:AQUA) CEO Getting Paid? - Simply Wall St
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