U.S. Markets closed

Should You Worry About Great-West Lifeco Inc.'s (TSE:GWO) CEO Pay Cheque?

Simply Wall St

Paul Mahon has been the CEO of Great-West Lifeco Inc. (TSE:GWO) since 2013. This analysis aims first to contrast CEO compensation with other large companies. Next, we'll consider growth that the business demonstrates. 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.

See our latest analysis for Great-West Lifeco

How Does Paul Mahon's Compensation Compare With Similar Sized Companies?

According to our data, Great-West Lifeco Inc. has a market capitalization of CA$30b, and paid its CEO total annual compensation worth CA$7.1m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at CA$1.2m. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. When we examined a group of companies with market caps over CA$11b, we found that their median CEO total compensation was CA$9.1m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).

So Paul Mahon receives a similar amount to the median CEO pay, amongst 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 Great-West Lifeco, below.

TSX:GWO CEO Compensation, December 5th 2019

Is Great-West Lifeco Inc. Growing?

Over the last three years Great-West Lifeco Inc. has grown its earnings per share (EPS) by an average of 2.3% per year (using a line of best fit). In the last year, its revenue is up 1.1%.

I'm not particularly impressed by the revenue growth, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. It could be important to check this free visual depiction of what analysts expect for the future.

Has Great-West Lifeco Inc. Been A Good Investment?

Great-West Lifeco Inc. has not done too badly by shareholders, with a total return of 8.0%, over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Paul Mahon is paid around the same as most CEOs of large companies.

The company isn't showing particularly great growth, and shareholder turns haven't been particularly inspiring in the last few years. While there is room for improvement, we haven't seen evidence to suggest the pay is too generous. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Great-West Lifeco.

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

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.

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. Thank you for reading.