Is Castle Minerals Limited’s (ASX:CDT) CEO Overpaid Relative To Its Peers?
Stephen Stone became the CEO of Castle Minerals Limited (ASX:CDT) in 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for Castle Minerals
How Does Stephen Stone’s Compensation Compare With Similar Sized Companies?
According to our data, Castle Minerals Limited has a market capitalization of AU$2.0m, and pays its CEO total annual compensation worth AU$128k. (This is based on the year to 2018). We note that’s an increase of 37% above last year. While we always look at total compensation first, we note that the salary component is less, at AU$114k. We looked at a group of companies with market capitalizations under AU$282m, and the median CEO compensation was AU$368k.
Most shareholders would consider it a positive that Stephen Stone takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it’s important we delve into the performance of the actual business.
You can see a visual representation of the CEO compensation at Castle Minerals, below.
Is Castle Minerals Limited Growing?
Castle Minerals Limited has reduced its earnings per share by an average of 13% a year, over the last three years. It achieved revenue growth of 386% over the last year.
The reduction in earnings per share, over three years, is arguably concerning. But on the other hand, revenue growth is strong, suggesting a brighter future. In conclusion we can’t form a strong opinion about business performance yet; but it’s one worth watching.
Although we don’t have analyst forecasts, you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Castle Minerals Limited Been A Good Investment?
Castle Minerals Limited has generated a total shareholder return of 29% over three years, so most shareholders would be reasonably content. But they probably don’t want to see the CEO paid more than is normal for companies around the same size.
In Summary…
Castle Minerals Limited is currently paying its CEO below what is normal for companies of its size.
It’s well worth noting that while Stephen Stone is paid less than most company leaders (at companies of similar size), share price performance has been somewhat uninspiring. But on this analysis I see no issue with the CEO compensation. Shareholders may want to check for free if Castle Minerals insiders are buying or selling shares.
Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
