Is Cranswick plc's (LON:CWK) CEO Paid At A Competitive Rate?
In 2012 Adam Couch was appointed CEO of Cranswick plc (LON:CWK). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. 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.
View our latest analysis for Cranswick
How Does Adam Couch's Compensation Compare With Similar Sized Companies?
According to our data, Cranswick plc has a market capitalization of UK£1.6b, and paid its CEO total annual compensation worth UK£1.9m over the year to March 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at UK£635k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£779m to UK£2.5b. The median total CEO compensation was UK£1.4m.
It would therefore appear that Cranswick plc pays Adam Couch more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Cranswick, below.
Is Cranswick plc Growing?
Cranswick plc has increased its earnings per share (EPS) by an average of 9.2% a year, over the last three years (using a line of best fit). It saw its revenue drop 1.9% over the last year.
I would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see EPS growth. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. It could be important to check this free visual depiction of what analysts expect for the future.
Has Cranswick plc Been A Good Investment?
I think that the total shareholder return of 52%, over three years, would leave most Cranswick plc shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
We compared total CEO remuneration at Cranswick plc with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
While we generally prefer to see stronger EPS growth, there's no arguing with the strong returns to shareholders, over the last three years. As a result of the juicy return to investors, the CEO remuneration may well be quite reasonable. Shareholders may want to check for free if Cranswick insiders are buying or selling shares.
Important note: Cranswick may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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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.
