The CEO of Axiom Properties Limited (ASX:AXI) is Ben Laurance. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Ben Laurance's Compensation Compare With Similar Sized Companies?
Our data indicates that Axiom Properties Limited is worth AU$18m, and total annual CEO compensation is AU$638k. (This number is for the twelve months until June 2019). That's below the compensation, last year. While we always look at total compensation first, we note that the salary component is less, at AU$516k. We looked at a group of companies with market capitalizations under AU$292m, and the median CEO total compensation was AU$372k.
It would therefore appear that Axiom Properties Limited pays Ben Laurance 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. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Axiom Properties has changed from year to year.
Is Axiom Properties Limited Growing?
Axiom Properties Limited has reduced its earnings per share by an average of 33% a year, over the last three years (measured with a line of best fit). Its revenue is down -88% over last year.
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 you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Axiom Properties Limited Been A Good Investment?
With a total shareholder return of 28% over three years, Axiom Properties Limited shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared total CEO remuneration at Axiom Properties 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.
Earnings per share have not grown in three years, and the revenue growth fails to impress us.
And shareholder returns are decent but not great. So we think more research is needed, but we don't think the CEO underpaid. Shareholders may want to check for free if Axiom Properties insiders are buying or selling shares.
Important note: Axiom Properties 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 firstname.lastname@example.org. 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.