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Philip Littlewood has been the CEO of Stride Stapled Group (NZSE:SPG) since 2017, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Stride Stapled Group.
Note: The company does not report funds from operations, and as a result, we have used earnings per share in our analysis.
How Does Total Compensation For Philip Littlewood Compare With Other Companies In The Industry?
According to our data, Stride Stapled Group has a market capitalization of NZ$1.1b, and paid its CEO total annual compensation worth NZ$938k over the year to March 2020. We note that's a small decrease of 6.2% on last year. We note that the salary portion, which stands at NZ$615.0k constitutes the majority of total compensation received by the CEO.
On comparing similar companies from the same industry with market caps ranging from NZ$557m to NZ$2.2b, we found that the median CEO total compensation was NZ$1.3m. So it looks like Stride Stapled Group compensates Philip Littlewood in line with the median for the industry. What's more, Philip Littlewood holds NZ$665k worth of shares in the company in their own name.
On an industry level, around 53% of total compensation represents salary and 47% is other remuneration. It's interesting to note that Stride Stapled Group pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Stride Stapled Group's Growth
Over the last three years, Stride Stapled Group has shrunk its earnings per share by 7.7% per year. It achieved revenue growth of 23% over the last year.
Investors would be a bit wary of companies that have lower EPS But on the other hand, revenue growth is strong, suggesting a brighter future. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Stride Stapled Group Been A Good Investment?
Most shareholders would probably be pleased with Stride Stapled Group for providing a total return of 59% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
As we touched on above, Stride Stapled Group is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Investors will be happy that Stride Stapled Group has produced strong shareholder returns for the past three years. Meanwhile, revenues have been increasing recently On a sour note, EPS growth has been negative. However, considering overall positive performance, we think Philip, shareholders might not be too worried about the CEO's compensation.
CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 4 warning signs for Stride Stapled Group (of which 1 doesn't sit too well with us!) that you should know about in order to have a holistic understanding of the stock.
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.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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