In This Article:
Keith Creel became the CEO of Canadian Pacific Railway Limited (TSE:CP) in 2017, 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 evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Check out our latest analysis for Canadian Pacific Railway
How Does Total Compensation For Keith Creel Compare With Other Companies In The Industry?
At the time of writing, our data shows that Canadian Pacific Railway Limited has a market capitalization of CA$53b, and reported total annual CEO compensation of CA$15m for the year to December 2019. We note that's an increase of 21% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CA$1.5m.
On comparing similar companies in the industry with market capitalizations above CA$11b, we found that the median total CEO compensation was CA$12m. From this we gather that Keith Creel is paid around the median for CEOs in the industry. What's more, Keith Creel holds CA$7.1m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | CA$1.5m | CA$1.5m | 10% |
| Other | CA$14m | CA$11m | 90% |
| Total Compensation | CA$15m | CA$12m | 100% |
On an industry level, roughly 18% of total compensation represents salary and 82% is other remuneration. Canadian Pacific Railway pays a modest slice of remuneration through salary, as compared 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.
A Look at Canadian Pacific Railway Limited's Growth Numbers
Canadian Pacific Railway Limited has seen its earnings per share (EPS) increase by 15% a year over the past three years. It achieved revenue growth of 3.1% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. 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 Canadian Pacific Railway Limited Been A Good Investment?
We think that the total shareholder return of 109%, over three years, would leave most Canadian Pacific Railway Limited shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.