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Is Kina Securities Limited's (ASX:KSL) CEO Paid Enough Relative To Peers?

Simply Wall St

Greg Pawson became the CEO of Kina Securities Limited (ASX:KSL) in 2017. 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.

See our latest analysis for Kina Securities

How Does Greg Pawson's Compensation Compare With Similar Sized Companies?

According to our data, Kina Securities Limited has a market capitalization of AU$145m, and paid its CEO total annual compensation worth K1.9m over the year to December 2019. That's actually a decrease on the year before. While we always look at total compensation first, we note that the salary component is less, at K1.4m. We took a group of companies with market capitalizations below K687m, and calculated the median CEO total compensation to be K866k.

Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Kina Securities. Talking in terms of the sector, salary represented approximately 48% of total compensation out of all the companies we analysed, while other remuneration made up 52% of the pie. Kina Securities is paying a higher share of its remuneration through a salary in comparison to the overall industry.

As you can see, Greg Pawson is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Kina Securities Limited is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. You can see a visual representation of the CEO compensation at Kina Securities, below.

ASX:KSL CEO Compensation April 29th 2020

Is Kina Securities Limited Growing?

On average over the last three years, Kina Securities Limited has seen earnings per share (EPS) move in a favourable direction by 26% each year (using a line of best fit). Its revenue is up 28% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. You might want to check this free visual report on analyst forecasts for future earnings.

Has Kina Securities Limited Been A Good Investment?

Kina Securities Limited has generated a total shareholder return of 16% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

We compared total CEO remuneration at Kina Securities Limited with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. We also note that, over the same time frame, shareholder returns haven't been bad. While it may be worth researching further, we don't see a problem with the CEO pay, given the good EPS growth. Taking a breather from CEO compensation, we've spotted 5 warning signs for Kina Securities (of which 1 is a bit concerning!) you should know about in order to have a holistic understanding of the stock.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

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. Thank you for reading.