Key Insights

• Trinity Industries will host its Annual General Meeting on 20th of May
• CEO E. Savage's total compensation includes salary of US$930.0k
• The total compensation is similar to the average for the industry
• Over the past three years, Trinity Industries' EPS grew by 102% and over the past three years, the total shareholder return was 23%

CEO E. Savage has done a decent job of delivering relatively good performance at Trinity Industries, Inc. (NYSE:TRN) 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 20th of May. Here is our take on why we think the CEO compensation looks appropriate.

How Does Total Compensation For E. Savage Compare With Other Companies In The Industry?

Our data indicates that Trinity Industries, Inc. has a market capitalization of US$2.5b, and total annual CEO compensation was reported as US$5.7m for the year to December 2023. That's just a smallish increase of 4.3% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$930k.

On examining similar-sized companies in the American Machinery industry with market capitalizations between US$2.0b and US$6.4b, we discovered that the median CEO total compensation of that group was US$6.1m. So it looks like Trinity Industries compensates E. Savage in line with the median for the industry. Furthermore, E. Savage directly owns US$14m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. There isn't a significant difference between Trinity Industries and the broader market, in terms of salary allocation in the overall compensation package. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Trinity Industries, Inc.'s Growth Numbers

Trinity Industries, Inc.'s earnings per share (EPS) grew 102% per year over the last three years. In the last year, its revenue is up 47%.

Shareholders would be glad to know that the company has improved itself over the last few years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Trinity Industries, Inc. Been A Good Investment?

With a total shareholder return of 23% over three years, Trinity Industries, Inc. shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this 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. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 4 warning signs for Trinity Industries (of which 1 can't be ignored!) that you should know about in order to have a holistic understanding of the 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.