Phil St Baker has been the CEO of Novonix Limited (ASX:NVX) since 2015. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Phil St Baker's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Novonix Limited has a market cap of AU$67m, and is paying total annual CEO compensation of AU$686k. (This number is for the twelve months until June 2018). We think total compensation is more important but we note that the CEO salary is lower, at AU$122k. We looked at a group of companies with market capitalizations under AU$292m, and the median CEO total compensation was AU$362k.
As you can see, Phil St Baker is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Novonix Limited is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Novonix has changed from year to year.
Is Novonix Limited Growing?
On average over the last three years, Novonix Limited has shrunk earnings per share by 49% each year (measured with a line of best fit). Its revenue is up 107% over last year.
As investors, we are a bit wary of companies that have lower earnings per share, over three years. 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. It could be important to check this free visual depiction of what analysts expect for the future.
Has Novonix Limited Been A Good Investment?
With a three year total loss of 25%, Novonix Limited would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by Novonix Limited, and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Shareholders may wish to consider further research. Although we don't think the CEO pay is too high, it is probably more on the generous side of things. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Novonix.
Important note: Novonix 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.
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 firstname.lastname@example.org. 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.