Nick Jefferies became the CEO of discoverIE Group plc (LON:DSCV) in 2009. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Nick Jefferies's Compensation Compare With Similar Sized Companies?
Our data indicates that discoverIE Group plc is worth UK£347m, and total annual CEO compensation is UK£1.8m. (This figure is for the year to March 2019). That's actually a decrease on the year before. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at UK£453k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£165m to UK£659m. The median total CEO compensation was UK£719k.
As you can see, Nick Jefferies is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean discoverIE Group plc is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at discoverIE Group, below.
Is discoverIE Group plc Growing?
On average over the last three years, discoverIE Group plc has grown earnings per share (EPS) by 33% each year (using a line of best fit). Its revenue is up 13% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has discoverIE Group plc Been A Good Investment?
Most shareholders would probably be pleased with discoverIE Group plc for providing a total return of 90% over three years. 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 examined the amount discoverIE Group plc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. Even better, returns to shareholders have been plentiful, over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling discoverIE Group (free visualization of insider trades).
Important note: discoverIE Group 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.
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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.