Yahoo Finance Shareholders May Not Be So Generous With Argosy Minerals Limited's (ASX:AGY) CEO Compensation And Here's Why
In the past three years, the share price of Argosy Minerals Limited (ASX:AGY) has struggled to grow and now shareholders are sitting on a loss. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. These are some of the concerns that shareholders may want to bring up at the next AGM held on 27 April 2021. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.
Check out our latest analysis for Argosy Minerals
How Does Total Compensation For Jerko Zuvela Compare With Other Companies In The Industry?
Our data indicates that Argosy Minerals Limited has a market capitalization of AU$116m, and total annual CEO compensation was reported as AU$274k for the year to December 2020. This was the same as last year. It is worth noting that the CEO compensation consists entirely of the salary, worth AU$274k.
In comparison with other companies in the industry with market capitalizations under AU$258m, the reported median total CEO compensation was AU$302k. From this we gather that Jerko Zuvela is paid around the median for CEOs in the industry. Moreover, Jerko Zuvela also holds AU$6.5m worth of Argosy Minerals stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2020 | 2019 | Proportion (2020) |
Salary | AU$274k | AU$274k | 100% |
Other | - | - | - |
Total Compensation | AU$274k | AU$274k | 100% |
Speaking on an industry level, nearly 69% of total compensation represents salary, while the remainder of 31% is other remuneration. At the company level, Argosy Minerals pays Jerko Zuvela solely through a salary, preferring to go down a conventional route. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Argosy Minerals Limited's Growth
Argosy Minerals Limited has seen its earnings per share (EPS) increase by 41% a year over the past three years. Its revenue is down 17% over the previous year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Argosy Minerals Limited Been A Good Investment?
The return of -71% over three years would not have pleased Argosy Minerals Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
Argosy Minerals rewards its CEO solely through a salary, ignoring non-salary benefits completely. Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.
CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 5 warning signs for Argosy Minerals (2 don't sit too well with us!) that you should be aware of before investing here.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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.
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