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Does Melcor Developments Ltd.'s (TSE:MRD) CEO Pay Compare Well With Peers?

Simply Wall St

Darin Rayburn became the CEO of Melcor Developments Ltd. (TSE:MRD) in 2017. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. 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.

View our latest analysis for Melcor Developments

How Does Darin Rayburn's Compensation Compare With Similar Sized Companies?

Our data indicates that Melcor Developments Ltd. is worth CA$408m, and total annual CEO compensation was reported as CA$1.0m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at CA$400k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. When we examined a selection of companies with market caps ranging from CA$267m to CA$1.1b, we found the median CEO total compensation was CA$1.4m.

So Darin Rayburn is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

You can see a visual representation of the CEO compensation at Melcor Developments, below.

TSX:MRD CEO Compensation, October 7th 2019

Is Melcor Developments Ltd. Growing?

Over the last three years Melcor Developments Ltd. has grown its earnings per share (EPS) by an average of 15% per year (using a line of best fit). In the last year, its revenue is down 1.3%.

This demonstrates that the company has been improving recently. A good result. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Melcor Developments Ltd. Been A Good Investment?

Melcor Developments Ltd. has not done too badly by shareholders, with a total return of 7.5%, over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

Darin Rayburn is paid around the same as most CEOs of similar size companies.

We would wish for better returns (whether dividends or capital gains) but we do admire the solid EPS growth on show here. So considering these factors, we think the CEO pay is probably quite reasonable. Shareholders may want to check for free if Melcor Developments insiders are buying or selling shares.

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.

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 editorial-team@simplywallst.com. 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.