Key Insights

• Manitowoc Company will host its Annual General Meeting on 7th of May
• Salary of US$944.2k is part of CEO Aaron Ravenscroft's total remuneration
• The total compensation is 150% higher than the average for the industry
• Manitowoc Company's three-year loss to shareholders was 51% while its EPS was down 57% over the past three years

The Manitowoc Company, Inc. (NYSE:MTW) has not performed well recently and CEO Aaron Ravenscroft will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 7th 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.

How Does Total Compensation For Aaron Ravenscroft Compare With Other Companies In The Industry?

At the time of writing, our data shows that The Manitowoc Company, Inc. has a market capitalization of US$429m, and reported total annual CEO compensation of US$6.7m for the year to December 2023. That's a notable increase of 20% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$944k.

In comparison with other companies in the American Machinery industry with market capitalizations ranging from US$200m to US$800m, the reported median CEO total compensation was US$2.7m. Hence, we can conclude that Aaron Ravenscroft is remunerated higher than the industry median. Furthermore, Aaron Ravenscroft directly owns US$2.8m worth of shares in the company.

On an industry level, roughly 15% of total compensation represents salary and 85% is other remuneration. Although there is a difference in how total compensation is set, Manitowoc Company more or less reflects the market in terms of setting the salary. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at The Manitowoc Company, Inc.'s Growth Numbers

The Manitowoc Company, Inc. has reduced its earnings per share by 57% a year over the last three years. Its revenue is up 9.6% over the last year.

The decline in EPS is a bit concerning. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 The Manitowoc Company, Inc. Been A Good Investment?

The return of -51% over three years would not have pleased The Manitowoc Company, Inc. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for Manitowoc Company you should be aware of, and 1 of them is a bit unpleasant.

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.