Key Insights

• MGM Resorts International to hold its Annual General Meeting on 1st of May
• Total pay for CEO Bill Hornbuckle includes US$2.00m salary
• The total compensation is similar to the average for the industry
• MGM Resorts International's total shareholder return over the past three years was 4.4% while its EPS grew by 66% over the past three years

Under the guidance of CEO Bill Hornbuckle, MGM Resorts International (NYSE:MGM) 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 1st of May. We present our case of why we think CEO compensation looks fair.

How Does Total Compensation For Bill Hornbuckle Compare With Other Companies In The Industry?

Our data indicates that MGM Resorts International has a market capitalization of US$13b, and total annual CEO compensation was reported as US$17m for the year to December 2023. That's a modest increase of 4.7% on the prior year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$2.0m.

In comparison with other companies in the American Hospitality industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$14m. This suggests that MGM Resorts International remunerates its CEO largely in line with the industry average. Furthermore, Bill Hornbuckle directly owns US$21m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 18% of total compensation represents salary and 82% is other remuneration. MGM Resorts International sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

MGM Resorts International's Growth

Over the past three years, MGM Resorts International has seen its earnings per share (EPS) grow by 66% per year. It achieved revenue growth of 23% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. 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 MGM Resorts International Been A Good Investment?

With a total shareholder return of 4.4% over three years, MGM Resorts International has done okay by shareholders, but there's always room for improvement. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

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. 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 compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 4 warning signs for MGM Resorts International (of which 1 is a bit concerning!) that you should know about in order to have a holistic understanding of the stock.

Important note: MGM Resorts International 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.