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Is Infigen Energy Limited's (ASX:IFN) CEO Paid At A Competitive Rate?

Simply Wall St

Ross Rolfe became the CEO of Infigen Energy Limited (ASX:IFN) in 2016. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Infigen Energy

How Does Ross Rolfe's Compensation Compare With Similar Sized Companies?

According to our data, Infigen Energy Limited has a market capitalization of AU$702m, and paid its CEO total annual compensation worth AU$1.9m over the year to June 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at AU$836k. We looked at a group of companies with market capitalizations from AU$301m to AU$1.2b, and the median CEO total compensation was AU$1.0m.

As you can see, Ross Rolfe is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Infigen Energy Limited is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

The graphic below shows how CEO compensation at Infigen Energy has changed from year to year.

ASX:IFN CEO Compensation, February 24th 2020

Is Infigen Energy Limited Growing?

Infigen Energy Limited has increased its earnings per share (EPS) by an average of 4.5% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 25%.

It's hard to interpret the strong revenue growth as anything other than a positive. Combined with modest EPS growth, we get a good impression of the company. I'd stop short of saying the business performance is amazing, but there are enough positives to justify further research, or even adding the stock to your watch-list. It could be important to check this free visual depiction of what analysts expect for the future.

Has Infigen Energy Limited Been A Good Investment?

Given the total loss of 21% over three years, many shareholders in Infigen Energy Limited are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We compared total CEO remuneration at Infigen Energy Limited with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.

Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Infigen Energy (free visualization of insider trades).

If you want to buy a stock that is better than Infigen Energy, 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 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.

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.