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In 2016 Michael Magnusson was appointed CEO of AeroCentury Corp. (NYSEMKT:ACY). 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Michael Magnusson's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that AeroCentury Corp. has a market cap of US$13m, and is paying total annual CEO compensation of US$354k. (This number is for the twelve months until December 2018). It is worth noting that the CEO compensation consists almost entirely of the salary, worth US$350k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$463k.
That means Michael Magnusson receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at AeroCentury, below.
Is AeroCentury Corp. Growing?
AeroCentury Corp. has reduced its earnings per share by an average of 61% a year, over the last three years (measured with a line of best fit). Its revenue is down -14% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.
Has AeroCentury Corp. Been A Good Investment?
With a three year total loss of 13%, AeroCentury Corp. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Michael Magnusson is paid around the same as most CEOs of similar size companies.
The company isn't growing EPS, and shareholder returns have been disappointing. Suffice it to say, we don't think the CEO is underpaid! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at AeroCentury.
Important note: AeroCentury 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.
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 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.