U.S. Markets open in 6 hrs 16 mins

Is Agnico Eagle Mines Limited's (NYSE:AEM) CEO Salary Justified?

Simply Wall St

Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

Sean Boyd has been the CEO of Agnico Eagle Mines Limited (NYSE:AEM) since 1998. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Agnico Eagle Mines

How Does Sean Boyd's Compensation Compare With Similar Sized Companies?

According to our data, Agnico Eagle Mines Limited has a market capitalization of US$11b, and pays its CEO total annual compensation worth US$9.5m. (This is based on the year to December 2018). That's below the compensation, last year. While we always look at total compensation first, we note that the salary component is less, at US$1.4m. When we examined a group of companies with market caps over US$8.0b, we found that their median CEO total compensation was US$11m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.

So Sean Boyd is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at Agnico Eagle Mines, below.

NYSE:AEM CEO Compensation, June 15th 2019

Is Agnico Eagle Mines Limited Growing?

Over the last three years Agnico Eagle Mines Limited has shrunk its earnings per share by an average of 46% per year (measured with a line of best fit). It saw its revenue drop -5.7% over the last year.

Sadly for shareholders, earnings per share are actually down, over three years. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.

Has Agnico Eagle Mines Limited Been A Good Investment?

Given the total loss of 5.0% over three years, many shareholders in Agnico Eagle Mines Limited are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

Sean Boyd is paid around what is normal the leaders of larger companies.

After looking at EPS and total shareholder returns, it's certainly hard to argue the company has performed well, since both metrics are down. Few would argue that it's wise for the company to pay any more, before returns improve. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Agnico Eagle Mines (free visualization of insider trades).

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.