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Darren Entwistle became the CEO of TELUS Corporation (TSE:T) in 2000. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big 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 process should give us an idea about how appropriately the CEO is paid.
How Does Darren Entwistle's Compensation Compare With Similar Sized Companies?
According to our data, TELUS Corporation has a market capitalization of CA$29b, and pays its CEO total annual compensation worth CA$13m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at CA$1.4m. We took a group of companies with market capitalizations over CA$10b, and calculated the median CEO total compensation to be CA$9.1m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
It would therefore appear that TELUS Corporation pays Darren Entwistle more than the median CEO remuneration at large companies, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at TELUS, below.
Is TELUS Corporation Growing?
TELUS Corporation has increased its earnings per share (EPS) by an average of 6.9% a year, over the last three years (using a line of best fit). Its revenue is up 5.5% over last year.
I'm not particularly impressed by the revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. Shareholders might be interested in this free visualization of analyst forecasts.
Has TELUS Corporation Been A Good Investment?
With a total shareholder return of 28% over three years, TELUS Corporation shareholders would, in general, be reasonably content. 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.
We examined the amount TELUS Corporation pays its CEO, and compared it to the amount paid by other large companies. We found that it pays well over the median amount paid in the benchmark group.
We generally prefer to see stronger EPS growth, and we're not particularly impressed with the total shareholder return, over the last three years. So it's certainly hard to argue that the CEO is modestly paid, although we don't see the remuneration as an issue. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling TELUS (free visualization of insider trades).
Important note: TELUS may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE 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 firstname.lastname@example.org. 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.