David Giraud has been the CEO of Inovalis Real Estate Investment Trust (TSE:INO.UN) since 2013. First, this article will compare CEO compensation with compensation at similar sized companies. 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 David Giraud's Compensation Compare With Similar Sized Companies?
According to our data, Inovalis Real Estate Investment Trust has a market capitalization of CA$273m, and paid its CEO total annual compensation worth CA$150k over the year to December 2018. It is worth noting that the CEO compensation consists almost entirely of the salary, worth CA$150k. We looked at a group of companies with market capitalizations from CA$132m to CA$529m, and the median CEO total compensation was CA$891k.
Most shareholders would consider it a positive that David Giraud takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
The graphic below shows how CEO compensation at Inovalis Real Estate Investment Trust has changed from year to year.
Is Inovalis Real Estate Investment Trust Growing?
Inovalis Real Estate Investment Trust has reduced its earnings per share by an average of 16% a year, over the last three years (measured with a line of best fit). It saw its revenue drop 7.9% over the last year.
Unfortunately, earnings per share have trended lower over the last three years. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.
Has Inovalis Real Estate Investment Trust Been A Good Investment?
I think that the total shareholder return of 53%, over three years, would leave most Inovalis Real Estate Investment Trust 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.
It appears that Inovalis Real Estate Investment Trust remunerates its CEO below most similar sized companies.
David Giraud receives relatively low remuneration compared to similar sized companies. And while the company isn't growing earnings per share, total returns have been pleasing. Although we could see higher EPS growth, we'd argue the remuneration is not an issue, based on these observations. So you may want to check if insiders are buying Inovalis Real Estate Investment Trust shares with their own money (free access).
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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