Yahoo Finance Is Globe Metals & Mining Limited's (ASX:GBE) CEO Being Overpaid?
Alistair Stephens has been the CEO of Globe Metals & Mining Limited (ASX:GBE) since 2013. 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. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Globe Metals & Mining
How Does Alistair Stephens's Compensation Compare With Similar Sized Companies?
According to our data, Globe Metals & Mining Limited has a market capitalization of AU$7.5m, and pays its CEO total annual compensation worth AU$409k. (This figure is for the year to June 2018). We think total compensation is more important but we note that the CEO salary is lower, at AU$385k. We examined a group of similar sized companies, with market capitalizations of below AU$295m. The median CEO total compensation in that group is AU$354k.
So Alistair Stephens is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
The graphic below shows how CEO compensation at Globe Metals & Mining has changed from year to year.
Is Globe Metals & Mining Limited Growing?
On average over the last three years, Globe Metals & Mining Limited has grown earnings per share (EPS) by 64% each year (using a line of best fit). It has seen most of its revenue evaporate over the past year.
This shows that the company has improved itself over the last few years. Good news for shareholders. While it would be good to see revenue growth, profits matter more in the end. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Globe Metals & Mining Limited Been A Good Investment?
Given the total loss of 19% over three years, many shareholders in Globe Metals & Mining Limited are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
Alistair Stephens is paid around what is normal the leaders of comparable size companies.
We think that the EPS growth is very pleasing, but we find the returns over the last three years to be lacking. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. Whatever your view on compensation, you might want to check if insiders are buying or selling Globe Metals & Mining shares (free trial).
If you want to buy a stock that is better than Globe Metals & Mining, 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.
