Yahoo Finance Is Talon Petroleum Limited's (ASX:TPD) CEO Overpaid Relative To Its Peers?
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Matt Worner is the CEO of Talon Petroleum Limited (ASX:TPD). 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for Talon Petroleum
How Does Matt Worner's Compensation Compare With Similar Sized Companies?
According to our data, Talon Petroleum Limited has a market capitalization of AU$5.3m, and pays its CEO total annual compensation worth AU$139k. (This figure is for the year to December 2018). Notably, that's an increase of 116% over the year before. While we always look at total compensation first, we note that the salary component is less, at AU$109k. We examined a group of similar sized companies, with market capitalizations of below AU$291m. The median CEO total compensation in that group is AU$358k.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see a visual representation of the CEO compensation at Talon Petroleum, below.
Is Talon Petroleum Limited Growing?
Over the last three years Talon Petroleum Limited has grown its earnings per share (EPS) by an average of 84% per year (using a line of best fit). It achieved revenue growth of 24% over the last year.
This demonstrates that the company has been improving recently. A good result. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. 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 Talon Petroleum Limited Been A Good Investment?
With a three year total loss of 70%, Talon Petroleum Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
It looks like Talon Petroleum Limited pays its CEO less than similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. Few would deny that the total shareholder return over the last three years could have been a lot better. We're not critical of the remuneration Matt Worner receives, but it would be good to see improved returns to shareholders before the remuneration grows too much.
This sort of circumstance certainly justifies further research, because the investment returns might still come in the future. Whatever your view on compensation, you might want to check if insiders are buying or selling Talon Petroleum shares (free trial).
If you want to buy a stock that is better than Talon Petroleum, 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.
