L. Sampson has been the CEO of Advanced Emissions Solutions, Inc. (NASDAQ:ADES) since 2015. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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.
How Does L. Sampson's Compensation Compare With Similar Sized Companies?
Our data indicates that Advanced Emissions Solutions, Inc. is worth US$226m, and total annual CEO compensation was reported as US$1.6m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$500k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$100m to US$400m. The median total CEO compensation was US$1.2m.
Thus we can conclude that L. Sampson receives more in total compensation than the median of a group of companies in the same market, and of similar size to Advanced Emissions Solutions, Inc.. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Advanced Emissions Solutions has changed from year to year.
Is Advanced Emissions Solutions, Inc. Growing?
Advanced Emissions Solutions, Inc. has reduced its earnings per share by an average of 9.5% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 197%.
The reduction in earnings per share, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. 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. Shareholders might be interested in this free visualization of analyst forecasts.
Has Advanced Emissions Solutions, Inc. Been A Good Investment?
Boasting a total shareholder return of 81% over three years, Advanced Emissions Solutions, Inc. has done well by shareholders. 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.
We compared the total CEO remuneration paid by Advanced Emissions Solutions, Inc., and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
One might like to have seen stronger growth, but shareholder returns have been pleasing, over the last three years. Considering this fine result for investors, we daresay the CEO compensation might be apt. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Advanced Emissions Solutions.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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 email@example.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.