Michael Johnson is the CEO of Rhinomed Limited (ASX:RNO). 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. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Michael Johnson's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Rhinomed Limited has a market cap of AU$27m, and reported total annual CEO compensation of AU$748k for the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at AU$305k. We looked at a group of companies with market capitalizations under AU$299m, and the median CEO total compensation was AU$378k.
As you can see, Michael Johnson is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Rhinomed Limited is paying too much. 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 Rhinomed, below.
Is Rhinomed Limited Growing?
Rhinomed Limited has increased its earnings per share (EPS) by an average of 26% a year, over the last three years (using a line of best fit). Its revenue is up 49% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. You might want to check this free visual report on analyst forecasts for future earnings.
Has Rhinomed Limited Been A Good Investment?
Rhinomed Limited has generated a total shareholder return of 6.7% over three years, so most shareholders wouldn't be too disappointed. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
We compared the total CEO remuneration paid by Rhinomed Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. We also think investors are doing ok, over the same time period. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. So you may want to check if insiders are buying Rhinomed shares with their own money (free access).
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 email@example.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.
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