Key Things To Understand About Rayonier's (NYSE:RYN) CEO Pay Cheque

Dave Nunes has been the CEO of Rayonier Inc. (NYSE:RYN) since 2014, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Rayonier pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Note: The company does not report funds from operations, and as a result, we have used earnings per share in our analysis.

View our latest analysis for Rayonier

How Does Total Compensation For Dave Nunes Compare With Other Companies In The Industry?

Our data indicates that Rayonier Inc. has a market capitalization of US$3.6b, and total annual CEO compensation was reported as US$4.7m for the year to December 2019. That's a notable increase of 8.4% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$775k.

In comparison with other companies in the industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$5.4m. This suggests that Rayonier remunerates its CEO largely in line with the industry average. Furthermore, Dave Nunes directly owns US$8.9m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 15% of total compensation represents salary and 85% is other remuneration. Rayonier pays out 17% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Rayonier Inc.'s Growth Numbers

Rayonier Inc. has reduced its earnings per share by 26% a year over the last three years. It achieved revenue growth of 19% over the last year.

The decrease in EPS could be a concern for some investors. On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch. 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 Rayonier Inc. Been A Good Investment?

Given the total shareholder loss of 5.4% over three years, many shareholders in Rayonier Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

As we noted earlier, Rayonier pays its CEO in line with similar-sized companies belonging to the same industry. Still, the company is logging healthy revenue growth over the last year. On the other hand, shareholder returns for Dave are negative over the same period. EPS is also not growing, undoubtedly leading to further headaches. We'd say CEO compensation isn't unfair, but shareholders may be wary of a bump in pay before the company substantially improves overall performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 5 warning signs (and 1 which makes us a bit uncomfortable) in Rayonier 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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