Yahoo Finance How Should Investors React To OZ Minerals Limited’s (ASX:OZL) CEO Pay?
Andrew Cole became the CEO of OZ Minerals Limited (ASX:OZL) in 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
View our latest analysis for OZ Minerals
How Does Andrew Cole’s Compensation Compare With Similar Sized Companies?
According to our data, OZ Minerals Limited has a market capitalization of AU$2.8b, and pays its CEO total annual compensation worth AU$2m. That’s actually a decrease on the year before. We examined companies with market caps from AU$1.4b to AU$4.5b, and discovered that the median CEO compensation of that group was AU$3m.
Most shareholders would consider it a positive that Andrew Cole takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. While this is a good thing, you’ll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at OZ Minerals has changed over time.
Is OZ Minerals Limited Growing?
On average over the last three years, OZ Minerals Limited has grown earnings per share (EPS) by 35% each year. It achieved revenue growth of 27% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business.
You might want to check this free visual report on analyst forecasts for future earnings.
Has OZ Minerals Limited Been A Good Investment?
Most shareholders would probably be pleased with OZ Minerals Limited for providing a total return of 111% over three years. So they may not be at all concerned if the CEO is paid more than is normal for companies around the same size.
In Summary…
OZ Minerals Limited is currently paying its CEO below what is normal for companies of its size. Considering the underlying business is growing earnings, this would suggest the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Andrew Cole deserves a raise!
It’s not often we see shareholders do so well, and yet the CEO is paid modestly. The cherry on top would be if company insiders are buying shares with their own money. Whatever your view on compensation, you might want to check if insiders are buying or selling OZ Minerals Limited shares (free trial).
Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
