In 1999 Keith Neilson was appointed CEO of Craneware plc (LON:CRW). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Keith Neilson’s Compensation Compare With Similar Sized Companies?
Our data indicates that Craneware plc is worth UK£663m, and total annual CEO compensation is US$878k. (This is based on the year to 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$420k. When we examined a selection of companies with market caps ranging from US$400m to US$1.6b, we found the median CEO compensation was US$1.3m.
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.
You can see a visual representation of the CEO compensation at Craneware, below.
Is Craneware plc Growing?
Over the last three years Craneware plc has grown its earnings per share (EPS) by an average of 18% per year (using a line of best fit). It achieved revenue growth of 16% 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.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Craneware plc Been A Good Investment?
I think that the total shareholder return of 227%, over three years, would leave most Craneware plc shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
Craneware plc is currently paying its CEO below what is normal for companies of its size. Since the business is growing, many would argue this suggests the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Keith Neilson deserves a raise!
It’s not often we see shareholders do so well, and yet the CEO is paid modestly. But it is even better if company insiders are also buying shares with their own money. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Craneware.
Or you might prefer examine intently this intuitive graph showing past earnings and revenue.
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 firstname.lastname@example.org.