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Is Mercury NZ Limited (NZSE:MCY) Overpaying Its CEO?

Simply Wall St

In 2014 Fraser Whineray was appointed CEO of Mercury NZ Limited (NZSE:MCY). 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 - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Mercury NZ

How Does Fraser Whineray's Compensation Compare With Similar Sized Companies?

According to our data, Mercury NZ Limited has a market capitalization of NZ$7.3b, and paid its CEO total annual compensation worth NZ$2.0m over the year to June 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at NZ$1.1m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of NZ$3.1b to NZ$9.9b. The median total CEO compensation was NZ$2.1m.

So Fraser Whineray is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

You can see, below, how CEO compensation at Mercury NZ has changed over time.

NZSE:MCY CEO Compensation, February 17th 2020
NZSE:MCY CEO Compensation, February 17th 2020

Is Mercury NZ Limited Growing?

On average over the last three years, Mercury NZ Limited has grown earnings per share (EPS) by 20% each year (using a line of best fit). It achieved revenue growth of 11% over the last year.

This demonstrates that the company has been improving recently. A good result. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. Shareholders might be interested in this free visualization of analyst forecasts.

Has Mercury NZ Limited Been A Good Investment?

Boasting a total shareholder return of 108% over three years, Mercury NZ Limited 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.

In Summary...

Fraser Whineray is paid around the same as most CEOs of similar size companies.

The company is growing earnings per share and total shareholder returns have been pleasing. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Mercury NZ.

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.