Key Insights

• Boyd Gaming's Annual General Meeting to take place on 9th of May
• Total pay for CEO Keith Smith includes US$1.55m salary
• The overall pay is 38% above the industry average
• Boyd Gaming's EPS grew by 79% over the past three years while total shareholder loss over the past three years was 16%

Shareholders of Boyd Gaming Corporation (NYSE:BYD) will have been dismayed by the negative share price return over the last three years. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. The AGM coming up on the 9th of May could be an opportunity for shareholders to bring these concerns to the board's attention. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

Comparing Boyd Gaming Corporation's CEO Compensation With The Industry

According to our data, Boyd Gaming Corporation has a market capitalization of US$5.1b, and paid its CEO total annual compensation worth US$11m over the year to December 2023. Notably, that's an increase of 10% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.6m.

On comparing similar companies from the American Hospitality industry with market caps ranging from US$4.0b to US$12b, we found that the median CEO total compensation was US$8.2m. This suggests that Keith Smith is paid more than the median for the industry. Moreover, Keith Smith also holds US$55m worth of Boyd Gaming 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 17% of total compensation represents salary and 83% is other remuneration. Boyd Gaming pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Boyd Gaming Corporation's Growth

Boyd Gaming Corporation's earnings per share (EPS) grew 79% per year over the last three years. Its revenue is up 2.1% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. 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 Boyd Gaming Corporation Been A Good Investment?

Since shareholders would have lost about 16% over three years, some Boyd Gaming Corporation investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Boyd Gaming that investors should think about before committing capital to this stock.

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.