Joe Randell became the CEO of Chorus Aviation Inc. (TSE:CHR) in 2001. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Joe Randell's Compensation Compare With Similar Sized Companies?
Our data indicates that Chorus Aviation Inc. is worth CA$1.2b, and total annual CEO compensation was reported as CA$3.3m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at CA$775k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of CA$527m to CA$2.1b. The median total CEO compensation was CA$2.0m.
Thus we can conclude that Joe Randell receives more in total compensation than the median of a group of companies in the same market, and of similar size to Chorus Aviation Inc.. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Chorus Aviation has changed from year to year.
Is Chorus Aviation Inc. Growing?
Over the last three years Chorus Aviation Inc. has shrunk its earnings per share by an average of 7.7% per year (measured with a line of best fit). In the last year, its revenue is up 5.3%.
Unfortunately, earnings per share have trended lower over the last three years. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.
Has Chorus Aviation Inc. Been A Good Investment?
I think that the total shareholder return of 53%, over three years, would leave most Chorus Aviation Inc. shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
We compared total CEO remuneration at Chorus Aviation Inc. with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. On the other hand, returns have been good, so the company is doing something right. Considering this, shareholders are probably not too worried about the CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Chorus Aviation (free visualization of insider trades).
If you want to buy a stock that is better than Chorus Aviation, this free list of high return, low debt companies is a great place to look.
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