Jamie Pherous is the CEO of Corporate Travel Management Limited (ASX:CTD). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Jamie Pherous's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Corporate Travel Management Limited has a market cap of AU$1.9b, and reported total annual CEO compensation of AU$643k for the year to June 2019. While we always look at total compensation first, we note that the salary component is less, at AU$471k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of AU$1.5b to AU$4.7b. The median total CEO compensation was AU$2.1m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. Though positive, it's important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at Corporate Travel Management has changed from year to year.
Is Corporate Travel Management Limited Growing?
Over the last three years Corporate Travel Management Limited has grown its earnings per share (EPS) by an average of 23% per year (using a line of best fit). It achieved revenue growth of 21% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Corporate Travel Management Limited Been A Good Investment?
Corporate Travel Management Limited has generated a total shareholder return of 12% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
It appears that Corporate Travel Management Limited remunerates its CEO below most similar sized companies.
Many would consider this to indicate that the pay is modest since the business is growing. While some might be keen on seeing higher returns, our short analysis has not produced any evidence to suggest Jamie Pherous is overcompensated. Few would complain about reasonable CEO remuneration when the business is growing earnings per share. But for me, it's even better if insiders are also buying shares with their own cold, hard, cash. So you may want to check if insiders are buying Corporate Travel Management shares with their own money (free access).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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