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How Much Is Integral Diagnostics Limited (ASX:IDX) Paying Its CEO?

Simply Wall St
·4-min read

Ian Kadish has been the CEO of Integral Diagnostics Limited (ASX:IDX) since 2017, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Integral Diagnostics.

View our latest analysis for Integral Diagnostics

How Does Total Compensation For Ian Kadish Compare With Other Companies In The Industry?

At the time of writing, our data shows that Integral Diagnostics Limited has a market capitalization of AU$824m, and reported total annual CEO compensation of AU$1.2m for the year to June 2020. That's a notable increase of 38% on last year. In particular, the salary of AU$635.3k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the same industry with market capitalizations ranging between AU$282m and AU$1.1b had a median total CEO compensation of AU$982k. From this we gather that Ian Kadish is paid around the median for CEOs in the industry. What's more, Ian Kadish holds AU$371k worth of shares in the company in their own name.

Component

2020

2019

Proportion (2020)

Salary

AU$635k

AU$549k

52%

Other

AU$577k

AU$327k

48%

Total Compensation

AU$1.2m

AU$876k

100%

Talking in terms of the industry, salary represented approximately 72% of total compensation out of all the companies we analyzed, while other remuneration made up 28% of the pie. Integral Diagnostics pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

ceo-compensation
ceo-compensation

A Look at Integral Diagnostics Limited's Growth Numbers

Over the past three years, Integral Diagnostics Limited has seen its earnings per share (EPS) grow by 5.2% per year. Its revenue is up 19% over the last year.

We would argue that the modest growth in revenue is a notable positive. And, while modest, the EPS growth is noticeable. Although we'll stop short of calling the stock a top performer, we think the company has potential. 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 Integral Diagnostics Limited Been A Good Investment?

We think that the total shareholder return of 181%, over three years, would leave most Integral Diagnostics Limited shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

As we touched on above, Integral Diagnostics Limited is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But the business isn't reporting great numbers in terms of EPS growth. On the other hand, shareholder returns over the same period have been very healthy. We would like to see EPS growth from the business, although we wouldn't say the CEO compensation is high.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 4 warning signs for Integral Diagnostics that investors should think about before committing capital to this stock.

Switching gears from Integral Diagnostics, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.