U.S. Markets open in 6 hrs
  • S&P Futures

    +4.50 (+0.12%)
  • Dow Futures

    +24.00 (+0.08%)
  • Nasdaq Futures

    +37.75 (+0.31%)
  • Russell 2000 Futures

    -3.30 (-0.18%)
  • Crude Oil

    -0.72 (-1.58%)
  • Gold

    +0.50 (+0.03%)
  • Silver

    -0.19 (-0.81%)

    +0.0016 (+0.1312%)
  • 10-Yr Bond

    -0.0040 (-0.45%)
  • Vix

    -0.39 (-1.80%)

    +0.0011 (+0.0829%)

    -0.2200 (-0.2110%)

    +136.29 (+0.79%)
  • CMC Crypto 200

    -31.28 (-8.44%)
  • FTSE 100

    -28.16 (-0.44%)
  • Nikkei 225

    +107.40 (+0.40%)

Why DAVIDsTEA Inc.'s (NASDAQ:DTEA) CEO Pay Matters To You

Simply Wall St

The CEO of DAVIDsTEA Inc. (NASDAQ:DTEA) is Herschel Segal. First, this article will compare CEO compensation with compensation at similar sized companies. 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.

View our latest analysis for DAVIDsTEA

How Does Herschel Segal's Compensation Compare With Similar Sized Companies?

According to our data, DAVIDsTEA Inc. has a market capitalization of US$44m, and paid its CEO total annual compensation worth CA$597k over the year to February 2019. While we always look at total compensation first, we note that the salary component is less, at CA$250k. We took a group of companies with market capitalizations below CA$264m, and calculated the median CEO total compensation to be CA$669k.

So Herschel Segal is paid around the average of the companies we looked at. 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 DAVIDsTEA, below.

NasdaqGM:DTEA CEO Compensation, November 11th 2019
NasdaqGM:DTEA CEO Compensation, November 11th 2019

Is DAVIDsTEA Inc. Growing?

On average over the last three years, DAVIDsTEA Inc. has shrunk earnings per share by 79% each year (measured with a line of best fit). In the last year, its revenue is down 2.5%.

Sadly for shareholders, earnings per share are actually down, over three years. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has DAVIDsTEA Inc. Been A Good Investment?

Since shareholders would have lost about 84% over three years, some DAVIDsTEA Inc. shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Remuneration for Herschel Segal is close enough to the median pay for a CEO of a similar sized company .

After looking at EPS and total shareholder returns, it's certainly hard to argue the company has performed well, since both metrics are down. Suffice it to say, we don't think the CEO is underpaid! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at DAVIDsTEA.

If you want to buy a stock that is better than DAVIDsTEA, this free list of high return, low debt companies is a great place to look.

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.