Paul Burton is the CEO of TNG Limited (ASX:TNG). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Paul Burton's Compensation Compare With Similar Sized Companies?
Our data indicates that TNG Limited is worth AU$91m, and total annual CEO compensation was reported as AU$557k for the year to June 2019. That's below the compensation, last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at AU$521k. We looked at a group of companies with market capitalizations under AU$291m, and the median CEO total compensation was AU$379k.
As you can see, Paul Burton is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean TNG 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 TNG has changed over time.
Is TNG Limited Growing?
Over the last three years TNG Limited has grown its earnings per share (EPS) by an average of 38% per year (using a line of best fit). In the last year, its revenue is down 49%.
This shows that the company has improved itself over the last few years. Good news for shareholders. Revenue growth is a real positive for growth, but ultimately profits are more important. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has TNG Limited Been A Good Investment?
With a three year total loss of 50%, TNG Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
We compared the total CEO remuneration paid by TNG Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. Having said that, shareholders may be disappointed with the weak returns over the last three years. 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. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling TNG (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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If you spot an error that warrants correction, please contact the editor at email@example.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.