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How Should Investors Feel About Alexco Resource Corp.'s (TSE:AXU) CEO Pay?

Simply Wall St

Clynt Nauman became the CEO of Alexco Resource Corp. (TSE:AXU) in 2004. 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 process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Alexco Resource

How Does Clynt Nauman's Compensation Compare With Similar Sized Companies?

According to our data, Alexco Resource Corp. has a market capitalization of CA$433m, and pays its CEO total annual compensation worth CA$1.1m. (This is based on the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at CA$300k. We looked at a group of companies with market capitalizations from US$200m to US$800m, and the median CEO total compensation was US$1.0m.

So Clynt Nauman is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.

You can see, below, how CEO compensation at Alexco Resource has changed over time.

TSX:AXU CEO Compensation, September 6th 2019

Is Alexco Resource Corp. Growing?

On average over the last three years, Alexco Resource Corp. has shrunk earnings per share by 2.8% each year (measured with a line of best fit). It achieved revenue growth of 134% over the last year.

Investors should note that, over three years, earnings per share are down. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. Shareholders might be interested in this free visualization of analyst forecasts.

Has Alexco Resource Corp. Been A Good Investment?

I think that the total shareholder return of 36%, over three years, would leave most Alexco Resource Corp. shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Remuneration for Clynt Nauman is close enough to the median pay for a CEO of a similar sized company .

While we would like to see improved growth metrics, there is no doubt that the total returns have been great, over the last three years. So considering most shareholders would be happy, we'd say the CEO pay is appropriate. So you may want to check if insiders are buying Alexco Resource shares with their own money (free access).

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity 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.