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In 2012 Darren Hotchkin was appointed CEO of Saferoads Holdings Limited (ASX:SRH). First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Darren Hotchkin’s Compensation Compare With Similar Sized Companies?
According to our data, Saferoads Holdings Limited has a market capitalization of AU$13m, and pays its CEO total annual compensation worth AU$305k. (This number is for the twelve months until 2018). We think total compensation is more important but we note that the CEO salary is lower, at AU$240k. We took a group of companies with market capitalizations below AU$282m, and calculated the median CEO compensation to be AU$363k.
So Darren Hotchkin receives a similar amount to the median CEO pay, amongst 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 Saferoads Holdings, below.
Is Saferoads Holdings Limited Growing?
Over the last three years Saferoads Holdings Limited has grown its earnings per share (EPS) by an average of 125% per year (using a line of best fit). It achieved revenue growth of 13% over the last year.
This demonstrates that the company has been improving recently. A good result. It’s a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Saferoads Holdings Limited Been A Good Investment?
Most shareholders would probably be pleased with Saferoads Holdings Limited for providing a total return of 174% over three years. 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.
Remuneration for Darren Hotchkin is close enough to the median pay for a CEO of a similar sized company .
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. Shareholders may want to check for free if Saferoads Holdings insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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 email@example.com.