Under the guidance of CEO Michael Emory, Allied Properties Real Estate Investment Trust (TSE:AP.UN) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 10 May 2021. We present our case of why we think CEO compensation looks fair.

View our latest analysis for Allied Properties Real Estate Investment Trust

Comparing Allied Properties Real Estate Investment Trust's CEO Compensation With the industry

At the time of writing, our data shows that Allied Properties Real Estate Investment Trust has a market capitalization of CA$5.6b, and reported total annual CEO compensation of CA$2.9m for the year to December 2020. Notably, that's a decrease of 27% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at CA$950k.

On examining similar-sized companies in the industry with market capitalizations between CA$2.5b and CA$7.9b, we discovered that the median CEO total compensation of that group was CA$2.5m. This suggests that Allied Properties Real Estate Investment Trust remunerates its CEO largely in line with the industry average. Furthermore, Michael Emory directly owns CA$50m worth of shares in the company, implying that they are deeply invested in the company's success.

Speaking on an industry level, nearly 33% of total compensation represents salary, while the remainder of 67% is other remuneration. Although there is a difference in how total compensation is set, Allied Properties Real Estate Investment Trust more or less reflects the market in terms of setting the salary. 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 Allied Properties Real Estate Investment Trust's Growth Numbers

Allied Properties Real Estate Investment Trust's funds from operations (FFO) grew 14% per yearover the last three years. In the last year, its revenue is up 3.4%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Allied Properties Real Estate Investment Trust Been A Good Investment?

Allied Properties Real Estate Investment Trust has generated a total shareholder return of 14% 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...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 5 warning signs for Allied Properties Real Estate Investment Trust (of which 2 are concerning!) that you should know about in order to have a holistic understanding of the stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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