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Under the guidance of CEO Chris Hartwig, Korvest Ltd (ASX:KOV) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 22 October 2021. However, some shareholders will still be cautious of paying the CEO excessively.
Comparing Korvest Ltd's CEO Compensation With the industry
At the time of writing, our data shows that Korvest Ltd has a market capitalization of AU$73m, and reported total annual CEO compensation of AU$637k for the year to June 2021. We note that's an increase of 20% above last year. In particular, the salary of AU$332.4k, makes up a fairly large portion of the total compensation being paid to the CEO.
On comparing similar-sized companies in the industry with market capitalizations below AU$270m, we found that the median total CEO compensation was AU$363k. Accordingly, our analysis reveals that Korvest Ltd pays Chris Hartwig north of the industry median. Moreover, Chris Hartwig also holds AU$551k worth of Korvest stock directly under their own name.
Talking in terms of the industry, salary represented approximately 76% of total compensation out of all the companies we analyzed, while other remuneration made up 24% of the pie. In Korvest's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Korvest Ltd's Growth Numbers
Korvest Ltd's earnings per share (EPS) grew 62% per year over the last three years. Its revenue is up 12% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Korvest Ltd Been A Good Investment?
We think that the total shareholder return of 197%, over three years, would leave most Korvest Ltd shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.
CEO compensation can have a massive impact on performance, but it's just one element. We've identified 2 warning signs for Korvest that investors should be aware of in a dynamic business environment.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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