The CEO of Beeks Trading Corporation Ltd. (LON:BKS) is Gordon McArthur, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Comparing Beeks Trading Corporation Ltd.'s CEO Compensation With the industry
According to our data, Beeks Trading Corporation Ltd. has a market capitalization of UK£48m, and paid its CEO total annual compensation worth UK£62k over the year to June 2020. That's a notable decrease of 22% on last year. Notably, the salary which is UK£60.0k, represents most of the total compensation being paid.
On comparing similar-sized companies in the industry with market capitalizations below UK£148m, we found that the median total CEO compensation was UK£253k. This suggests that Gordon McArthur is paid below the industry median. Moreover, Gordon McArthur also holds UK£26m worth of Beeks Trading stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
On an industry level, roughly 67% of total compensation represents salary and 33% is other remuneration. Beeks Trading has gone down a largely traditional route, paying Gordon McArthur a high salary, giving it preference over non-salary benefits. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
Beeks Trading Corporation Ltd.'s Growth
Beeks Trading Corporation Ltd. has seen its earnings per share (EPS) increase by 130% a year over the past three years. Its revenue is up 27% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Beeks Trading Corporation Ltd. Been A Good Investment?
Most shareholders would probably be pleased with Beeks Trading Corporation Ltd. for providing a total return of 88% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
Gordon receives almost all of their compensation through a salary. As previously discussed, Gordon is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. Since EPS growth is heading in a positive direction; many would agree with our assessment that the pay is modest. And given most shareholders are probably very happy with recent shareholder returns, they might even think Gordon deserves a raise!
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 3 warning signs for Beeks Trading that investors should be aware of in a dynamic business environment.
Important note: Beeks Trading is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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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