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Is IAMGOLD Corporation's (TSE:IMG) CEO Overpaid Relative To Its Peers?

Simply Wall St

Steve Letwin has been the CEO of IAMGOLD Corporation (TSE:IMG) since 2010. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for IAMGOLD

How Does Steve Letwin's Compensation Compare With Similar Sized Companies?

According to our data, IAMGOLD Corporation has a market capitalization of CA$2.3b, and pays its CEO total annual compensation worth US$4.6m. (This number is for the twelve months until December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$925k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of CA$1.3b to CA$4.3b. The median total CEO compensation was CA$2.8m.

Thus we can conclude that Steve Letwin receives more in total compensation than the median of a group of companies in the same market, and of similar size to IAMGOLD Corporation. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see a visual representation of the CEO compensation at IAMGOLD, below.

TSX:IMG CEO Compensation, August 25th 2019

Is IAMGOLD Corporation Growing?

Over the last three years IAMGOLD Corporation has grown its earnings per share (EPS) by an average of 44% per year (using a line of best fit). Its revenue is down -12% over last year.

This demonstrates that the company has been improving recently. A good result. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Shareholders might be interested in this free visualization of analyst forecasts.

Has IAMGOLD Corporation Been A Good Investment?

With a three year total loss of 4.5%, IAMGOLD Corporation would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We compared total CEO remuneration at IAMGOLD Corporation with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.

However, the earnings per share growth over three years is certainly impressive. Having said that, shareholders may be disappointed with the weak returns over the last three years. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. Shareholders may want to check for free if IAMGOLD insiders are buying or selling shares.

Important note: IAMGOLD 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 editorial-team@simplywallst.com. 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.