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How Is Enterprise Group's (TSE:E) CEO Compensated?

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This article will reflect on the compensation paid to Len Jaroszuk who has served as CEO of Enterprise Group, Inc. (TSE:E) since 2004. This analysis will also assess whether Enterprise Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Enterprise Group

How Does Total Compensation For Len Jaroszuk Compare With Other Companies In The Industry?

Our data indicates that Enterprise Group, Inc. has a market capitalization of CA$9.2m, and total annual CEO compensation was reported as CA$1.1m for the year to December 2019. We note that's a decrease of 11% compared to last year. We note that the salary portion, which stands at CA$710.2k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under CA$262m, the reported median total CEO compensation was CA$347k. This suggests that Len Jaroszuk is paid more than the median for the industry. What's more, Len Jaroszuk holds CA$3.0m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2019

2018

Proportion (2019)

Salary

CA$710k

CA$646k

67%

Other

CA$346k

CA$547k

33%

Total Compensation

CA$1.1m

CA$1.2m

100%

On an industry level, around 54% of total compensation represents salary and 46% is other remuneration. It's interesting to note that Enterprise Group pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

ceo-compensation
ceo-compensation

Enterprise Group, Inc.'s Growth

Enterprise Group, Inc.'s earnings per share (EPS) grew 7.0% per year over the last three years. It saw its revenue drop 12% over the last year.

We generally like to see a little revenue growth, but the modest improvement in EPS is good. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Enterprise Group, Inc. Been A Good Investment?

With a three year total loss of 44% for the shareholders, Enterprise Group, Inc. would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we touched on above, Enterprise 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. Over the last three years, shareholder returns have been downright disappointing for Enterprise Group, and although EPS growth is steady, it hasn't set the world on fire. This doesn't look good when you see that Len is earning more than the industry median. With such poor returns, we would understand if shareholders had concerns related to the CEO's pay.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 3 warning signs for Enterprise Group (2 can't be ignored!) that you should be aware of before investing here.

Important note: Enterprise 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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