Michael Warren became the CEO of Earth Alive Clean Technologies Inc. (CVE:EAC) in 2017. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Michael Warren's Compensation Compare With Similar Sized Companies?
Our data indicates that Earth Alive Clean Technologies Inc. is worth CA$20m, and total annual CEO compensation was reported as CA$175k for the year to December 2018. Notably, the salary of CA$175k is the vast majority of the CEO compensation. We looked at a group of companies with market capitalizations under CA$282m, and the median CEO total compensation was CA$219k.
Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Earth Alive Clean Technologies. On a sector level, around 73% of total compensation represents salary and 27% is other remuneration. Speaking on a company level, Earth Alive Clean Technologies prefers to tread along a traditional path, disbursing all compensation through a salary.
That means Michael Warren receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance. You can see a visual representation of the CEO compensation at Earth Alive Clean Technologies, below.
Is Earth Alive Clean Technologies Inc. Growing?
Earth Alive Clean Technologies Inc. has reduced its earnings per share by an average of 9.9% a year, over the last three years (measured with a line of best fit). It achieved revenue growth of 51% over the last year.
The reduction in earnings per share, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Earth Alive Clean Technologies Inc. Been A Good Investment?
With a three year total loss of 81%, Earth Alive Clean Technologies Inc. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Michael Warren is paid around what is normal for the leaders of comparable size companies.
We would like to see somewhat stronger per share growth. And shareholder returns have been disappointing over the last three years. So suffice it to say we don't think the compensation is modest. CEO compensation is an important area to keep your eyes on, but we've also identified 7 warning signs for Earth Alive Clean Technologies (3 don't sit too well with us!) that you should be aware of before investing here.
If you want to buy a stock that is better than Earth Alive Clean Technologies, this free list of high return, low debt companies is a great place to look.
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.
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. Thank you for reading.