Key Insights

• PPL will host its Annual General Meeting on 15th of May
• Salary of US$1.20m is part of CEO Vince Sorgi's total remuneration
• Total compensation is similar to the industry average
• Over the past three years, PPL's EPS grew by 7.6% and over the past three years, the total shareholder return was 11%

Under the guidance of CEO Vince Sorgi, PPL Corporation (NYSE:PPL) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 15th of May. We present our case of why we think CEO compensation looks fair.

Comparing PPL Corporation's CEO Compensation With The Industry

Our data indicates that PPL Corporation has a market capitalization of US$21b, and total annual CEO compensation was reported as US$12m for the year to December 2023. We note that's an increase of 31% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.2m.

On comparing similar companies in the American Electric Utilities industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$14m. This suggests that PPL remunerates its CEO largely in line with the industry average. Moreover, Vince Sorgi also holds US$9.2m worth of PPL stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 11% of total compensation represents salary and 89% is other remuneration. Our data reveals that PPL allocates salary more or less in line with the wider market. 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 PPL Corporation's Growth Numbers

PPL Corporation has seen its earnings per share (EPS) increase by 7.6% a year over the past three years. In the last year, its revenue is down 3.9%.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has PPL Corporation Been A Good Investment?

With a total shareholder return of 11% over three years, PPL Corporation shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay 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 3 warning signs for PPL (of which 2 are significant!) that you should know about in order to have a holistic understanding of the stock.

Important note: PPL 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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.