In 2015 Alex Kent was appointed CEO of Aspermont Limited (ASX:ASP). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. 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 Alex Kent's Compensation Compare With Similar Sized Companies?
Our data indicates that Aspermont Limited is worth AU$21m, and total annual CEO compensation was reported as AU$505k for the year to September 2018. While we always look at total compensation first, we note that the salary component is less, at AU$350k. We looked at a group of companies with market capitalizations under AU$290m, and the median CEO total compensation was AU$381k.
Thus we can conclude that Alex Kent receives more in total compensation than the median of a group of companies in the same market, and of similar size to Aspermont Limited. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at Aspermont has changed over time.
Is Aspermont Limited Growing?
Over the last three years Aspermont Limited has grown its earnings per share (EPS) by an average of 8.2% per year (using a line of best fit). It achieved revenue growth of 17% over the last year.
This revenue growth could really point to a brighter future. And the improvement in earnings per share is modest but respectable. Although we'll stop short of calling the stock a top performer, we think the company has potential. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Aspermont Limited Been A Good Investment?
Aspermont Limited has served shareholders reasonably well, with a total return of 11% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
We compared total CEO remuneration at Aspermont Limited with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. So it's certainly hard to argue that the CEO is modestly paid, although we don't see the remuneration as an issue. So you may want to check if insiders are buying Aspermont shares with their own money (free access).
If you want to buy a stock that is better than Aspermont, this free list of high return, low debt companies is a great place to look.
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.
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