This article will reflect on the compensation paid to France Lauzière who has served as CEO of TVA Group Inc. (TSE:TVA.B) since 2017. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
How Does Total Compensation For France Lauzière Compare With Other Companies In The Industry?
According to our data, TVA Group Inc. has a market capitalization of CA$71m, and paid its CEO total annual compensation worth CA$992k over the year to December 2019. That's a notable increase of 9.2% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at CA$343k.
In comparison with other companies in the industry with market capitalizations under CA$266m, the reported median total CEO compensation was CA$341k. Accordingly, our analysis reveals that TVA Group Inc. pays France Lauzière north of the industry median.
On an industry level, total compensation is equally proportioned between salary and other compensation, that is, they each represent approximately 50% of the total compensation. TVA Group pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at TVA Group Inc.'s Growth Numbers
Over the past three years, TVA Group Inc. has seen its earnings per share (EPS) grow by 112% per year. In the last year, its revenue is down 4.9%.
Shareholders would be glad to know that the company has improved itself over the last few years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has TVA Group Inc. Been A Good Investment?
Since shareholders would have lost about 54% over three years, some TVA Group Inc. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
As we touched on above, TVA Group Inc. is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, the EPS growth is certainly impressive, but it's disappointing to see negative shareholder returns over the same period. Considering overall performance, we can't say France is underpaid, in fact compensation is definitely on the higher side.
CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 2 warning signs for TVA Group (of which 1 makes us a bit uncomfortable!) that you should know about in order to have a holistic understanding of the stock.
Important note: TVA Group is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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