Key Insights

• Newell Brands' Annual General Meeting to take place on 8th of May
• Salary of US$1.30m is part of CEO Chris Peterson's total remuneration
• Total compensation is similar to the industry average
• Newell Brands' three-year loss to shareholders was 74% while its EPS was down 92% over the past three years

The results at Newell Brands Inc. (NASDAQ:NWL) have been quite disappointing recently and CEO Chris Peterson bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 8th of May. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. We present the case why we think CEO compensation is out of sync with company performance.

Comparing Newell Brands Inc.'s CEO Compensation With The Industry

Our data indicates that Newell Brands Inc. has a market capitalization of US$2.0b, and total annual CEO compensation was reported as US$12m for the year to December 2024. We note that's a decrease of 51% compared to last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.3m.

For comparison, other companies in the American Consumer Durables industry with market capitalizations ranging between US$1.0b and US$3.2b had a median total CEO compensation of US$10m. So it looks like Newell Brands compensates Chris Peterson in line with the median for the industry. What's more, Chris Peterson holds US$2.7m worth of shares in the company in their own name.

Speaking on an industry level, nearly 19% of total compensation represents salary, while the remainder of 81% is other remuneration. Newell Brands pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Newell Brands Inc.'s Growth

Over the last three years, Newell Brands Inc. has shrunk its earnings per share by 92% per year. Its revenue is down 6.1% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Newell Brands Inc. Been A Good Investment?

With a total shareholder return of -74% over three years, Newell Brands Inc. shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 2 warning signs for Newell Brands (1 is a bit concerning!) that you should be aware of before investing here.

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.

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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.