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Ian Lowe became the CEO of Caledonian Trust PLC (LON:CNN) in 1987. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Ian Lowe's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Caledonian Trust PLC has a market cap of UK£27m, and is paying total annual CEO compensation of UK£114k. (This figure is for the year to June 2018). It is worth noting that the CEO compensation consists almost entirely of the salary, worth UK£110k. We examined a group of similar sized companies, with market capitalizations of below UK£160m. The median CEO total compensation in that group is UK£253k.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. Though positive, it's important we delve into the performance of the actual business.
You can see, below, how CEO compensation at Caledonian Trust has changed over time.
Is Caledonian Trust PLC Growing?
On average over the last three years, Caledonian Trust PLC has grown earnings per share (EPS) by 55% each year (using a line of best fit). It achieved revenue growth of 251% over the last year.
This demonstrates that the company has been improving recently. A good result. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Caledonian Trust PLC Been A Good Investment?
Most shareholders would probably be pleased with Caledonian Trust PLC for providing a total return of 183% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
It looks like Caledonian Trust PLC pays its CEO less than similar sized companies. Since the business is growing, many would argue this suggests the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Ian Lowe deserves a raise!
Most shareholders like to see a modestly paid CEO combined with strong performance by the company. It would be even more positive if company insiders are buying shares. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Caledonian Trust.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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.