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Should You Worry About IBI Group Inc.'s (TSE:IBG) CEO Salary Level?

Simply Wall St

Scott Stewart became the CEO of IBI Group Inc. (TSE:IBG) in 2013. 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 - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for IBI Group

How Does Scott Stewart's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that IBI Group Inc. has a market cap of CA$177m, and reported total annual CEO compensation of CA$1.2m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at CA$613k. We examined a group of similar sized companies, with market capitalizations of below CA$263m. The median CEO total compensation in that group is CA$160k.

Thus we can conclude that Scott Stewart receives more in total compensation than the median of a group of companies in the same market, and of similar size to IBI Group Inc.. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see a visual representation of the CEO compensation at IBI Group, below.

TSX:IBG CEO Compensation, October 13th 2019

Is IBI Group Inc. Growing?

Over the last three years IBI Group Inc. has grown its earnings per share (EPS) by an average of 33% per year (using a line of best fit). In the last year, its revenue is up 1.5%.

This demonstrates that the company has been improving recently. A good result. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Shareholders might be interested in this free visualization of analyst forecasts.

Has IBI Group Inc. Been A Good Investment?

Given the total loss of 19% over three years, many shareholders in IBI Group Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared total CEO remuneration at IBI Group Inc. 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.

However, the earnings per share growth over three years is certainly impressive. On the other hand returns to investors over the same period have probably disappointed many. Considering the per share profit growth, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling IBI Group (free visualization of insider trades).

If you want to buy a stock that is better than IBI Group, 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.