Shareholders Will Probably Be Cautious Of Increasing Comms Group Limited's (ASX:CCG) CEO Compensation At The Moment
Under the guidance of CEO Peter McGrath, Comms Group Limited (ASX:CCG) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 22 November 2022. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.
See our latest analysis for Comms Group
How Does Total Compensation For Peter McGrath Compare With Other Companies In The Industry?
Our data indicates that Comms Group Limited has a market capitalization of AU$27m, and total annual CEO compensation was reported as AU$535k for the year to June 2022. That's a fairly small increase of 7.4% over the previous year. Notably, the salary which is AU$293.0k, represents a considerable chunk of the total compensation being paid.
For comparison, other companies in the industry with market capitalizations below AU$295m, reported a median total CEO compensation of AU$493k. From this we gather that Peter McGrath is paid around the median for CEOs in the industry. Moreover, Peter McGrath also holds AU$1.3m worth of Comms Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2022 | 2021 | Proportion (2022) |
Salary | AU$293k | AU$293k | 55% |
Other | AU$242k | AU$205k | 45% |
Total Compensation | AU$535k | AU$498k | 100% |
On an industry level, roughly 46% of total compensation represents salary and 54% is other remuneration. According to our research, Comms Group has allocated a higher percentage of pay to salary in comparison to the wider industry. 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.
A Look at Comms Group Limited's Growth Numbers
Over the past three years, Comms Group Limited has seen its earnings per share (EPS) grow by 128% per year. It achieved revenue growth of 64% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Comms Group Limited Been A Good Investment?
Comms Group Limited has generated a total shareholder return of 4.3% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.
In Summary...
The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Comms Group that you should be aware of before investing.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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