In 2014 Andrew Skafel was appointed CEO of Edgewater Wireless Systems Inc. (CVE:YFI). First, this article will compare CEO compensation with compensation at similar sized companies. 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 method should give us information to assess how appropriately the company pays the CEO.
How Does Andrew Skafel's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Edgewater Wireless Systems Inc. has a market cap of CA$16m, and is paying total annual CEO compensation of CA$180k. (This number is for the twelve months until April 2018). Notably, the salary of CA$180k is the vast majority of the CEO compensation. We looked at a group of companies with market capitalizations under CA$268m, and the median CEO total compensation was CA$142k.
So Andrew Skafel receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at Edgewater Wireless Systems has changed over time.
Is Edgewater Wireless Systems Inc. Growing?
Edgewater Wireless Systems Inc. has reduced its earnings per share by an average of 4.2% a year, over the last three years (measured with a line of best fit). Its revenue is up 86% over last year.
The reduction in earnings per share, over three years, is arguably concerning. But on the other hand, revenue growth is strong, suggesting a brighter future. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Edgewater Wireless Systems Inc. Been A Good Investment?
Since shareholders would have lost about 50% over three years, some Edgewater Wireless Systems Inc. shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
Andrew Skafel is paid around the same as most CEOs of similar size companies.
The company cannot boast particularly strong per share growth. And it's hard to argue that the returns over the last three years have delighted. So many would argue that the CEO is certainly not underpaid. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Edgewater Wireless Systems (free visualization of insider trades).
Important note: Edgewater Wireless Systems 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.
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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.