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Should You Worry About Nova Minerals Limited's (ASX:NVA) CEO Pay?

Simply Wall St

Avi Kimelman has been the CEO of Nova Minerals Limited (ASX:NVA) since 2015. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Nova Minerals

How Does Avi Kimelman's Compensation Compare With Similar Sized Companies?

Our data indicates that Nova Minerals Limited is worth AU$44m, and total annual CEO compensation was reported as AU$436k for the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at AU$198k. We looked at a group of companies with market capitalizations under AU$289m, and the median CEO total compensation was AU$379k.

So Avi Kimelman is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

You can see a visual representation of the CEO compensation at Nova Minerals, below.

ASX:NVA CEO Compensation, January 15th 2020

Is Nova Minerals Limited Growing?

On average over the last three years, Nova Minerals Limited has grown earnings per share (EPS) by 62% each year (using a line of best fit). In the last year, its revenue is up 29%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Nova Minerals Limited Been A Good Investment?

Most shareholders would probably be pleased with Nova Minerals Limited for providing a total return of 236% over three years. 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...

Avi Kimelman is paid around what is normal the leaders of comparable size companies.

Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. 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 Nova Minerals.

If you want to buy a stock that is better than Nova Minerals, this free list of high return, low debt companies is a great place to look.

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.