Daniel Kenny has been the CEO of OncoSil Medical Limited (ASX:OSL) since 2015. First, this article will compare CEO compensation with compensation at similar sized companies. 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Daniel Kenny's Compensation Compare With Similar Sized Companies?
Our data indicates that OncoSil Medical Limited is worth AU$33m, and total annual CEO compensation is AU$1.1m. (This figure is for the year to June 2018). We think total compensation is more important but we note that the CEO salary is lower, at AU$460k. We took a group of companies with market capitalizations below AU$279m, and calculated the median CEO total compensation to be AU$354k.
It would therefore appear that OncoSil Medical Limited pays Daniel Kenny 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 better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at OncoSil Medical has changed from year to year.
Is OncoSil Medical Limited Growing?
OncoSil Medical Limited has reduced its earnings per share by an average of 20% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 1.0%.
Unfortunately, earnings per share have trended lower over the last three years. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.
Has OncoSil Medical Limited Been A Good Investment?
Given the total loss of 68% over three years, many shareholders in OncoSil Medical Limited are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
We examined the amount OncoSil Medical Limited pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
Over the same period, investors would have come away with nothing in the way of share price gains. In our opinion the CEO might be paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling OncoSil Medical (free visualization of insider trades).
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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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.