Stephen Wetmore has been the CEO of Canadian Tire Corporation, Limited (TSE:CTC.A) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Stephen Wetmore's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Canadian Tire Corporation, Limited has a market cap of CA$8.6b, and is paying total annual CEO compensation of CA$12m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at CA$1.5m. When we examined a selection of companies with market caps ranging from CA$5.3b to CA$16b, we found the median CEO total compensation was CA$5.3m.
It would therefore appear that Canadian Tire Corporation, Limited pays Stephen Wetmore more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration 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, below, how CEO compensation at Canadian Tire has changed over time.
Is Canadian Tire Corporation, Limited Growing?
Canadian Tire Corporation, Limited has increased its earnings per share (EPS) by an average of 7.1% a year, over the last three years (using a line of best fit). Its revenue is up 6.1% over last year.
I'm not particularly impressed by the revenue growth, but the modest improvement in EPS is good. Considering these factors I'd say performance has been pretty decent, though not amazing. Shareholders might be interested in this free visualization of analyst forecasts.
Has Canadian Tire Corporation, Limited Been A Good Investment?
Canadian Tire Corporation, Limited has not done too badly by shareholders, with a total return of 2.0%, over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared total CEO remuneration at Canadian Tire Corporation, Limited 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.
One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. Considering this, we wouldn't want to see any big pay rises, although we'd stop short of calling the CEO compensation unfair. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Canadian Tire.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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