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Why Olympia Financial Group Inc.'s (TSE:OLY) CEO Pay Matters To You

Simply Wall St

Rick Skauge has been the CEO of Olympia Financial Group Inc. (TSE:OLY) since 1996. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Olympia Financial Group

How Does Rick Skauge's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Olympia Financial Group Inc. has a market cap of CA$108m, and reported total annual CEO compensation of CA$3.6m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at . We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We examined a group of similar sized companies, with market capitalizations of below CA$267m. The median CEO total compensation in that group is CA$159k.

It would therefore appear that Olympia Financial Group Inc. pays Rick Skauge more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

You can see, below, how CEO compensation at Olympia Financial Group has changed over time.

TSX:OLY CEO Compensation, October 8th 2019

Is Olympia Financial Group Inc. Growing?

Olympia Financial Group Inc. has increased its earnings per share (EPS) by an average of 27% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 7.5%.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Although we don't have analyst forecasts you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Olympia Financial Group Inc. Been A Good Investment?

I think that the total shareholder return of 146%, over three years, would leave most Olympia Financial Group Inc. shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

We compared the total CEO remuneration paid by Olympia Financial Group Inc., 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.

Importantly, though, the company has impressed with its earnings per share growth, over three years. In addition, shareholders have done well over the same time period. So, considering this good performance, the CEO compensation may be quite appropriate. So you may want to check if insiders are buying Olympia Financial Group shares with their own money (free access).

Important note: Olympia Financial Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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.