U.S. Markets closed

Is Talisman Mining Limited (ASX:TLM) Excessively Paying Its CEO?

Simply Wall St

Dan Madden has been the CEO of Talisman Mining Limited (ASX:TLM) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Talisman Mining

How Does Dan Madden's Compensation Compare With Similar Sized Companies?

According to our data, Talisman Mining Limited has a market capitalization of AU$17m, and paid its CEO total annual compensation worth AU$603k over the year to June 2019. That's less than last year. While we always look at total compensation first, we note that the salary component is less, at AU$350k. We examined a group of similar sized companies, with market capitalizations of below AU$290m. The median CEO total compensation in that group is AU$379k.

As you can see, Dan Madden is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Talisman Mining Limited is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Talisman Mining has changed over time.

ASX:TLM CEO Compensation, December 22nd 2019

Is Talisman Mining Limited Growing?

Over the last three years Talisman Mining Limited has grown its earnings per share (EPS) by an average of 13% per year (using a line of best fit). It achieved revenue growth of 637% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. 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 Talisman Mining Limited Been A Good Investment?

Since shareholders would have lost about 5.6% over three years, some Talisman Mining Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We compared total CEO remuneration at Talisman Mining Limited with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.

However we must not forget that the EPS growth has been very strong over three years. However, the returns to investors are far less impressive, over the same period. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Talisman Mining.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

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. Thank you for reading.