Yahoo Finance Does Fleetwood Corporation Limited's (ASX:FWD) CEO Pay Reflect Performance?
Brad Denison became the CEO of Fleetwood Corporation Limited (ASX:FWD) in 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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.
View our latest analysis for Fleetwood
How Does Brad Denison's Compensation Compare With Similar Sized Companies?
Our data indicates that Fleetwood Corporation Limited is worth AU$161m, and total annual CEO compensation is AU$1.0m. (This is based on the year to June 2018). We think total compensation is more important but we note that the CEO salary is lower, at AU$585k. We looked at a group of companies with market capitalizations under AU$297m, and the median CEO total compensation was AU$362k.
Thus we can conclude that Brad Denison receives more in total compensation than the median of a group of companies in the same market, and of similar size to Fleetwood Corporation Limited. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Fleetwood has changed from year to year.
Is Fleetwood Corporation Limited Growing?
On average over the last three years, Fleetwood Corporation Limited has grown earnings per share (EPS) by 63% each year (using a line of best fit). In the last year, its revenue is up 18%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Fleetwood Corporation Limited Been A Good Investment?
With a total shareholder return of 3.4% over three years, Fleetwood Corporation Limited has done okay by shareholders. 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.
In Summary...
We compared the total CEO remuneration paid by Fleetwood Corporation 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.
However we must not forget that the EPS growth has been very strong over three years. We also note that, over the same time frame, shareholder returns haven't been bad. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. Whatever your view on compensation, you might want to check if insiders are buying or selling Fleetwood shares (free trial).
Important note: Fleetwood 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 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.
