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Should You Worry About Aurizon Holdings Limited's (ASX:AZJ) CEO Salary Level?

Simply Wall St

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Tony Harding became the CEO of Aurizon Holdings Limited (ASX:AZJ) in 2016. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. 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.

Check out our latest analysis for Aurizon Holdings

How Does Tony Harding's Compensation Compare With Similar Sized Companies?

Our data indicates that Aurizon Holdings Limited is worth AU$11b, and total annual CEO compensation is AU$4.1m. (This figure is for the year to June 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at AU$1.7m. We examined companies with market caps from AU$5.7b to AU$17b, and discovered that the median CEO total compensation of that group was AU$4.1m.

So Tony Harding receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

The graphic below shows how CEO compensation at Aurizon Holdings has changed from year to year.

ASX:AZJ CEO Compensation, June 26th 2019

Is Aurizon Holdings Limited Growing?

On average over the last three years, Aurizon Holdings Limited has grown earnings per share (EPS) by 51% each year (using a line of best fit). In the last year, its revenue is down -2.7%.

This shows that the company has improved itself over the last few years. Good news for shareholders. While it would be good to see revenue growth, profits matter more in the end. Shareholders might be interested in this free visualization of analyst forecasts.

Has Aurizon Holdings Limited Been A Good Investment?

Boasting a total shareholder return of 36% over three years, Aurizon Holdings Limited has done well by shareholders. 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...

Tony Harding is paid around the same as most CEOs of similar size companies.

The company is growing earnings per share and total shareholder returns have been pleasing. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Aurizon Holdings.

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

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.