24/7 Wall St. » TRW

America’s 10 Highest Paid CEOs (Which Are Worth It?)

Charles B. Stockdale — Tue, 20 Dec 2011 11:22:17 +0000

Several lists of the highest paid CEOs in America are published each year mostly by the business media and shareholder groups. All are based on proxy statements. Long before the lists are published, the boards of directors of these companies try to justify the compensation packages for shareholders. Investors often are skeptical of these defenses, and they should be. It is rare, but not impossible, to show that a chief executive deserves $50 million, or even $100 million a year.

Read America’s 10 Highest Paid CEOs

Based on the annual CEO Pay Survey 2011 by GMI, 24/7 Wall St. identified the 10 highest paid CEOs. We then analyzed company performance of the highest paid CEOs to determine which pay packages were worth the investment.

Such a review about management compensation is by its nature subjective and different from a board’s reasoning. A board may take into account the long-term record of a CEO who has held his or her job for several years. The board might set a pay package based on an extraordinary year. The directors also may pay a CEO well just before he or she retires. 24/7 Wall St. has downplayed each of these factors, but has not eliminated them. Our judgment of “fairness” is based on what shareholders received in the year as the CEO’s compensation year. Our primary measurements are revenue growth, earnings growth and stock price change.

This is the 24/7 Wall St. list of the 10 highest paid CEOs for 2010 and an analysis of whether their compensations were worth the payments in terms of shareholder returns. All compensation considerations used to set pay, which include board of director criteria from each company, come from SEC-filed proxies.

Filed under: General, Special Report Tagged: AET, CVS, GBL, GGP, MCK, OCR, RL, TRW, VNO, VRSK

Ten Highest Paid CEOs of 2010 (MCK, OCR, TRW, VRSK, CVS, GGP, RL, VNO, AET, GBL)

Paul Ausick — Thu, 15 Dec 2011 17:07:59 +0000

When it comes to executive pay, the amounts paid to today’s highest paid CEOs equals the GDP of a small emerging nation. The ten most highly compensated CEOs according to a recent survey by GMI took home about $770 million, more than the GDP of Vanuatu or Samoa, among others.

The GMI survey measures what the firm calls “total realized compensation,” which is further defined as “compensation that has been received by the CEO, rather than any notional estimates, accounting costs, or other uncertainties.” Here’s the list:

CEO	Company	Ticker	Compensation
John Hammergren	McKesson Corp.	MCK	$145,266,971
Joel Gemunder	Omnicare, Inc.	OCR	$98,283,242
John Plant	TRW Automotive Holdings Corp.	TRW	$76,841,646
Frank Coyne	Verisk Analytics, Inc.	VRSK	$69,416,726
Thomas Ryan	CVS Caremark Corp.	CVS	$68,079,823
Adam Metz	General Growth Properties, Inc.	GGP	$66,707,460
Ralph Lauren	Polo Ralph Lauren Corp.	RL	$66,651,515
Michael Fascitelli	Vornado Realty Trust	VNO	$64,402,468
Ronald Williams	Aetna, Inc.	AET	$57,787,786
Mario Gabelli	GAMCO Investors Inc.	GBL	$56,608,736

Paul Ausick

Filed under: Compensation Tagged: AET, CVS, GBL, GGP, MCK, OCR, RL, TRW, VNO, VRSK

Blackstone Group Still Holds Many Large Stock Positions After IPOs (BX, BKU, FSL, GGP, NLSN, OWW, TMH, TRW)

Administrator — Mon, 14 Nov 2011 21:11:19 +0000

The Blackstone Group L.P. (NYSE: BX) may look like it has a huge portfolio of public stocks to many investors. While that is actually true, the bulk of this is due to its portfolio companies coming public and it being forced (or wanting to) hold on to a large number of shares. Its total value of public equities (and options) was listed as $5.98 billion as of September 30, 2011.

The larger positions worth $100 million or more are as follows:

BANKUNITED, INC. (NYSE: BKU) at $284.851 million for 13,721,131 shares.

FREESCALE SEMICONDUCTOR HOLDINGS, LTD. (NYSE: FSL) at $2.16 billion for 196,136,895 shares.

GENERAL GROWTH PROPERTIES INC. (NYSE: GGP) at $604.3 million for 49,942,980 shares.

NIELSEN HOLDINGS N.V. (NYSE: NLSN) at $1.436 billion for 55,095,361 shares.

ORBITZ WORLDWIDE INC. (NYSE: OWW) at $119.45 million for 55,046,598 shares.

TEAM HEALTH HOLDINGS, INC. (NYSE: TMH) at $583.01 million for 35,506,563 shares.

TRW AUTOMOTIVE HOLDINGS CORP. (NYSE: TRW) at $637.85 million for 19,488,416 shares.

JON C. OGG

Filed under: Mutual Funds, Private Equity Tagged: BKU, BX, FSL, GGP, NLSN, OWW, TMH, TRW

High Return on Equity, A Primer For Future High Dividends (PM, CL, SCSS, CPB, TRW, KO, BLL)

Administrator — Tue, 14 Jun 2011 16:21:04 +0000

Our screen today is for companies with an attractive Returns on Equity (ROE) in the consumer goods sector. It is our view that ROE is one of the better quick indicators of a well-managed company. We also wanted to see what sort of dividends were being paid out as well. Except where otherwise noted, the source for all performance and financial data is Finviz.com.

Our screen produced seven respected companies. We list them here in descending order of their respective ROE’s: Phillip Morris International, Inc. (NYSE: PM), Colgate-Palmolive Co. (NYSE: CL), Select Comfort Corporation (NASD: SCSS), Campbell Soup Co. (NYSE: CPB), TRW Automotive Holdings Corp. (NYSE: TRW), The Coca-Cola Company (NYSE: KO), Ball Corporation (NYSE: BLL). These seven companies sport ROE’s ranging from 36.4% to 167.8%. Their PE ratios range from 7.5 to 19.8, while their forward PE’s range from 7.2 to 15.3.

Among these seven companies, Phillip Morris, Campbell Soup, Coca-Cola and Colgate Palmolive pay the better dividends. Some of these companies already offer high dividends, but using the return on equity may help us determine which can offer high dividends (or even higher dividends) in the future.

Phillip Morris International, Inc. (NYSE: PM) boasts a nearly startling 167.8% ROE. Is that too good to be true? In the face of health warnings and litigation, the cigarette giant’s annual earnings are up more than 21%. PM’s forward price to earnings ratio is 13.3. The dividend looks high at a yield of 3.8%, but that is low for a tobacco company as it is still considered more of a growth story than the domestic tobacco players. The shares currently trade near $68. Its 52-week price range is $42.64 to $71.75.

Colgate-Palmolive Co. (NYSE: CL) shows an eye-catching 98.8% ROE, again something that seems almost too good to be true. The personal products company boasts quarter-over-quarter growth of 68%. Colgate’s forward PE is 15.4 and it pays a dividend yield of 2.7% to its common stock holders. Currently trading around $86, CL’s 52-week price range of $71.61 to $87.58.

Select Comfort Corporation (NASDAQ: SCSS): The home furnishings company sports a ROE of 76.2%. Its quarter-over-quarter earnings are up 110%, having recovered from a 26% annual earnings drop. The company has a forward PE of 13.1, it has traded since the late-1990s, yet has no dividend… Maybe it is time to loosen up the company’s purse strings for shareholders. SCSS shares trade just under $15, up 4.6% from yesterdays close. Its 52-week trading range is $4.92 to $17.86.

Campbell Soup Co. (NYSE: CPB) is shown to have a ROE of 74.9%. Its quarter-over-quarter earnings are up 18%. The company’s forward PE ratio is 13.7 and it offers a high dividend yield of about 3.4%. CPB’s shares are trading almost unchanged today after closing at $33.92 yesterday. Its 52-week trading range is $32.38 to $36.68.

TRW Automotive Holdings Corp. (NYSE: TRW): The auto parts company boasts a 48.0% ROE. TRW’s quarter-over-quarter earnings are up 32.3%. The company’s forward PE is 7.2 but there is no dividend today. After closing at $52.36 yesterday, the shares currently trade near $54, up more than 3%. The 52-week price range is $26.20 to $63.26.

The Coca-Cola Company (NYSE: KO) return on equity is 42.3%. Its annual earnings are up almost 73%. Coke’s forward PE is 15.2, a tad greater than its current PE of 12.6. It boasts a 2.9% dividend yield. With the shares currently trading near $65.50, its 52-week price range is $48.07 to $68.28.

Ball Corporation (NYSE: BLL), the maker of Ball home canning jars and other packaging and container products, shows a ROE of 36.4%. The company’s annual earnings are up 44% and its quarter-over-quarter earnings are up more than 22%. Ball’s forward PE is 11.7 and its dividend yield is only 0.7%. The shares currently trade near $38. Its 52-week price range is $25.53 to $39.51.

As with any screens, we always recommend for investors to use their own methodology for their own investment objectives. Return on equity and dividend screening with forward P/E ratios can be wonderful tools for value, growth, and income investors. That being said, we are the first to admit that there are many pieces to a puzzle. As always, don’t forget our one underlying mantra in investing that never changes regardless of the business and market cycle: “Know what you are investing in.”

Jim Berdou

Filed under: Consumer Goods, Corporate Governance, Dividend, Value Investing Tagged: BLL, CL, CPB, KO, PM, SCSS, TRW

Johnson Controls: Beating Earnings & Raising Guidance Is Not Enough (JCI, HON, CREE, XIDE, AONE, MAG, TRW)

Administrator — Thu, 20 Jan 2011 18:22:50 +0000

The ride continues at Johnson Controls, Inc. (NYSE: JCI). For the first quarter of its 2011 fiscal year, the company reported record net sales of $9.5 billion and record income of $533 million, or EPS of $0.55. Analysts were expecting EPS of $0.54 on sales of $8.97 billion. Over the past year, Johnson’s stock has performed better than nearly all its competitors in the company’s main lines of business. That may be part of the problem today.

In its building efficiency segment, the company competes with Honeywell International Inc. (NYSE: HON) and Cree, Inc. (NASDAQ: CREE). In its power segment, the company’s competitors include Exide Technologies (NASDAQ: XIDE) and A123 Systems, Inc. (NASDAQ: AONE). And in its automotive segment, Magna International Inc. (NYSE: MAG) and TRW Automotive Holdings Corp. (NYSE: TRW) are among a host of US and international competitors. With the exception of TRW, which more than doubled its stock price in the past year, Johnson shares have outperformed all the rest, rising about 40%.

The company has benefited from rising auto sales, increased installation of energy efficiency controls, and a contract to supply Wal-Mart Stores Inc. (NYSE: WMT) with auto batteries. Profits in the auto segment rose 46% compared with a year ago and profits in the building efficiency group rose 34%. More modest gains in revenue indicate that the company’s margins are strong and likely to get stronger.

On the strength of its first quarter report, Johnson raised its guidance for both sales and earnings. The company now forecasts full-year revenue to reach $38.5 billion, up from a previous estimate of $37 billion. Full-year EPS is rose from a previous estimate of $2.30-$2.45 to a new estimate of $2.50-$2.55. The new guidance is better than analysts’ expectations of EPS of $2.54 and revenue of $37.19 billion.

Johnson also expects to increase capital spending from $1.2 billion to $1.4 billion as it expands it capacity to make batteries. Johnson is currently building new capacity to manufacture start-stop batteries, a technology that will be available next year on some cars sold in the US by Ford Motor Co. (NYSE: F).

The company’s CEO noted that Johnson is “increasingly confident” that it will post record results in 2011, and that the company will “consistently outperform our markets and increase shareholder value.”

So far today, though, Johnson’s shares are down nearly 2.5%, to $39.15, near the top of the company’s 52-week range of $25.56-$41.45. Volume is also heavier than usual in the shares.

Paul Ausick

Filed under: Autos, Earnings Tagged: AONE, CREE, HON, JCI, MAG, TRW, XIDE

Analyst Upgrades And Downgrades

247wallst — Tue, 15 Jun 2010 11:35:20 +0000

BP plc (NYSE: BP) was downgraded by Fitch.

JPM Securites downgrades Eli Lilly (NYSE: ELY) to market perform.

Rosetta Resources (NASDAQ: ROSE) downgraded to neutral by SunTrust

Callaway (NYSE: ELI) downgraded to market perform by JPM Securities.

T Rowe Price (NASDAQ: TROW) upgraded to market perform by Wells Fargo.

Calgene (NASDAQ: CELG) upgraded to neutral by Cowen.

TRW (NYSE: TRW) upgraded to overweight by JP Morgan.

Belgian government rankings held level by S&P.

EU attacks Fitch for Greek downgrade by Moody’s

Douglas A. McIntyre

Sponsor: 26 Cheap Stocks to Sell – Cheap stocks have been on a tear recently, but nine out of ten stocks are circling the drain!

Filed under: Analyst Calls Tagged: BP, ELI, ELY, GELG, ROSE, TROM, TRW

Top 10 Analyst Upgrades, Downgrades, Initiations (ACOR, IP, OPEN, PBR, SPWRA, ASML, LAZ, PETD, TRW, WDC)

247wallst — Thu, 15 Oct 2009 12:27:15 +0000

These are this morning’s top 10 pre-market analyst upgrades, downgrades, and initiations which we have seen early from Wall Street research firms:

Acorda (NASDAQ: ACOR) Raised to Buy at Merriman Curhan Ford; Raised to Outperform at Baird.
International Paper (NYSE: IP) Started as Outperform at RBC.
OpenTable (NASDAQ: OPEN) Raised to Buy at Citigroup.
PetroBras, or Petrobras Brasileiro (NYSE: PBR) Started as Outperform at Bernstein.
Sunpower (NASDAQ: SPWRA) Raised to Outperform at Baird.
ASML (NASDAQ: ASML) Cut to Sell at Citi.
Lazard (NYSE: LAZ) Cut to Perform at Oppenheimer.
Petroleum Development (NASDAQ: PETD) Cut to Neutral at Sun Trust.
Travelers Cos (NYSE: TRV) Cut To Market Perform at KBW.
Western Digital (NYSE: WDC) Cut to Hold at Stifel Nicolaus.

You can join our open email distribution list to get updates each morning on analyst upgrades and downgrades, top day trader alerts, IPO’s and secondary offerings, Warren Buffett and other guru activity, M&A and more.

JON C. OGG
OCTOBER 15, 2009

Posted in Analyst Calls Tagged: ACOR, ASML, IP, LAZ, OPEN, PBR, PETD, SPWRA, TRW, WDC

Top Day Trader Alerts (FRE, FNM, PCLN, RIMM, LLY, MCD, TRW, YRCW)

247wallst — Mon, 10 Aug 2009 13:11:54 +0000

These are this Monday’s top day trader and active trader alert stocks. More detailed price and volume data is provided via a link to each story at VSInvestor.com:

Freddie Mac (NYSE: FRE) and Fannie Mae (NYSE: FNM) are going to likely be today’s top day trader stocks after Freddie Mac said the GSE doesn’t need money from Uncle Sam (for now). We expect 100 million shares.

Priceline.com inc. (NASDAQ: PCLN) is soaring to 52-week highs after better than expected earnings.

Research In Motion Ltd. (NASDAQ: RIMM) is down with a potential chart alert after UBS downgraded it.

Eli Lilly & Co. (NYSE: LLY) is down 3.5% and could get worse on an ugly downgrade from Goldman Sachs.

McDonald’s Corp. (NYSE: MCD) has a severe chart alert after its same store sales report.

TRW Automotive Holdings Corp. (NYSE: TRW) is down 7% on a secondary offering announcement.

YRC Worldwide Inc. (NASDAQ: YRCW) is one of the stronger stocks with 15% gains after another labor agreement was approved.

JON C. OGG
AUGUST 10, 2009

Posted in Pre-Market Activity, Trading Alert Tagged: FNM, FRE, LLY, MCD, PCLN, RIMM, TRW, YRCW

Top 10 Analyst Upgrades and Downgrades (AA, BBBY, BRK.A, DFS, LYG, SNY, SWI, TRW, ZBRA)

247wallst — Mon, 29 Jun 2009 11:46:33 +0000

These are the top analyst upgrades, downgrades and initiations of new coverage which we have see from Wall Street this Monday morning:

ALCOA (AA) Cut to Underperform at FBR.
Bed Bath & Beyond (BBBY) Started as Buy at Wedbush Morgan.
Berkshire Hathaway Inc. (BRK.A) Started as Outperform at KBW.
Discover Financial (DFS) Raised to Outperform at KBW.
Lloyds Banking Group plc (LYG) Raised to Conviction By List at Goldman Sachs.
Sanofi-Aventis (SNY) Cut to Neutral at JPMorgan.
SolarWinds (SWI) Started as Overweight at JPMorgan; Started as Overweight at Thomas Weisel.
TRW (TRW) Raised to Overweight at JPMorgan.
Zebra Technologies (ZBRA) Raised to Outperform at Baird.

Jon C. Ogg
June 29, 2009

Posted in Analyst Calls, Buffett Tagged: AA, BBBY, BRK-A, DFS, LYG, SNY, SWI, TRW, ZBRA

Top Analyst Upgrades (CTV, DPS, COOL, PBG, TRW, WLL)

247wallst — Thu, 02 Apr 2009 11:38:36 +0000

These are the top pre-market analyst upgrades and positive research calls we have seen from Wall Street this Thursday morning:

CommScope (CTV) Raised to Outperform at Baird.
Dr. Pepper Snapple (DPS) Raised to Buy at Deutsche Bank.
Majesco Entertainment (COOL) Raised to Buy at Needham.
Pepsi Bottling (PBG) Raised to Buy at Deutsche Bank.
TRW Automotive (TRW) Raised to Neutral from Underweight at JPMorgan.
Whiting Petroleum (WLL) Started as Overweight at Thomas Weisel.

JON C. OGG

Posted in Analyst Calls Tagged: COOL, CTV, DPS, PBG, TRW, WLL