Should You Be Pleased About The CEO Pay At XRF Scientific Limited's (ASX:XRF)
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
In 2012 Vance Stazzonelli was appointed CEO of XRF Scientific Limited (ASX:XRF). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for XRF Scientific
How Does Vance Stazzonelli's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that XRF Scientific Limited has a market cap of AU$25m, and is paying total annual CEO compensation of AU$292k. (This is based on the year to June 2018). We think total compensation is more important but we note that the CEO salary is lower, at AU$262k. We took a group of companies with market capitalizations below AU$289m, and calculated the median CEO total compensation to be AU$354k.
That means Vance Stazzonelli 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 XRF Scientific, below.
Is XRF Scientific Limited Growing?
XRF Scientific Limited has reduced its earnings per share by an average of 14% a year, over the last three years (measured with a line of best fit). It achieved revenue growth of 18% over the last year.
Sadly for shareholders, earnings per share are actually down, over three years. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for me to put aside my concerns around earnings. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.
Has XRF Scientific Limited Been A Good Investment?
XRF Scientific Limited has generated a total shareholder return of 7.8% over three years, so most shareholders wouldn't be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Vance Stazzonelli is paid around what is normal the leaders of comparable size companies.
The company isn't growing earnings per share, and nor have the total returns inspired us. We do not think the CEO pay is a problem, but we'd venture the company should look to improve its business metrics (and share price) before paying any more. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling XRF Scientific (free visualization of insider trades).
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 editorial-team@simplywallst.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.
