Craig McGuckin has been the CEO of First Graphene Limited (ASX:FGR) since 2012. 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Craig McGuckin's Compensation Compare With Similar Sized Companies?
According to our data, First Graphene Limited has a market capitalization of AU$69m, and paid its CEO total annual compensation worth AU$489k over the year to June 2019. It is worth noting that the CEO compensation consists almost entirely of the salary, worth AU$477k. We looked at a group of companies with market capitalizations under AU$287m, and the median CEO total compensation was AU$381k.
So Craig McGuckin is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at First Graphene has changed over time.
Is First Graphene Limited Growing?
First Graphene Limited has reduced its earnings per share by an average of 1.2% a year, over the last three years (measured with a line of best fit). Its revenue is up 217% over last year.
The reduction in earnings per share, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. 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. Although we don't have analyst forecasts you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has First Graphene Limited Been A Good Investment?
I think that the total shareholder return of 50%, over three years, would leave most First Graphene Limited 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.
Craig McGuckin is paid around what is normal the leaders of comparable size companies.
While we would like to see improved growth metrics, there is no doubt that the total returns have been great, over the last three years. So we can conclude that on this analysis the CEO compensation seems pretty sound. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at First Graphene.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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