Key Insights
- OGE Energy will host its Annual General Meeting on 16th of May
- CEO Robert Trauschke's total compensation includes salary of US$1.16m
- Total compensation is similar to the industry average
- Over the past three years, OGE Energy's EPS grew by 2.2% and over the past three years, the total shareholder return was 24%
CEO Robert Trauschke has done a decent job of delivering relatively good performance at OGE Energy Corp. (NYSE:OGE) 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 16th of May. Here is our take on why we think the CEO compensation looks appropriate.
Comparing OGE Energy Corp.'s CEO Compensation With The Industry
According to our data, OGE Energy Corp. has a market capitalization of US$7.2b, and paid its CEO total annual compensation worth US$8.4m over the year to December 2023. We note that's an increase of 15% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.
On comparing similar companies from the American Electric Utilities industry with market caps ranging from US$4.0b to US$12b, we found that the median CEO total compensation was US$7.4m. So it looks like OGE Energy compensates Robert Trauschke in line with the median for the industry. Moreover, Robert Trauschke also holds US$16m worth of OGE Energy stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
| Component | 2023 | 2022 | Proportion (2023) |
| Salary | US$1.2m | US$1.1m | 14% |
| Other | US$7.3m | US$6.2m | 86% |
| Total Compensation | US$8.4m | US$7.3m | 100% |
Speaking on an industry level, nearly 11% of total compensation represents salary, while the remainder of 89% is other remuneration. According to our research, OGE Energy has allocated a higher percentage of pay to salary in comparison to the wider 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 OGE Energy Corp.'s Growth Numbers
OGE Energy Corp. has seen its earnings per share (EPS) increase by 2.2% a year over the past three years. It saw its revenue drop 19% over the last year.
We generally like to see a little revenue growth, but the modest EPS growth gives us some relief. It's hard to reach a conclusion about business performance right now. This may be one to watch. 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 OGE Energy Corp. Been A Good Investment?
OGE Energy Corp. has generated a total shareholder return of 24% 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...
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. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.
CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 2 warning signs for OGE Energy (of which 1 is a bit concerning!) that you should know about in order to have a holistic understanding of the stock.
Switching gears from OGE Energy, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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.