Does Painted Pony Energy Ltd.'s (TSE:PONY) CEO Salary Reflect Performance?

Simply Wall St
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Pat Ward has been the CEO of Painted Pony Energy Ltd. (TSE:PONY) since 2007. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Painted Pony Energy

How Does Pat Ward's Compensation Compare With Similar Sized Companies?

According to our data, Painted Pony Energy Ltd. has a market capitalization of CA$140m, and pays its CEO total annual compensation worth CA$1.8m. (This number is for the twelve months until December 2018). While we always look at total compensation first, we note that the salary component is less, at CA$450k. We took a group of companies with market capitalizations below CA$262m, and calculated the median CEO total compensation to be CA$120k.

As you can see, Pat Ward is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Painted Pony Energy Ltd. is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

You can see a visual representation of the CEO compensation at Painted Pony Energy, below.

TSX:PONY CEO Compensation, July 11th 2019
TSX:PONY CEO Compensation, July 11th 2019

Is Painted Pony Energy Ltd. Growing?

Over the last three years Painted Pony Energy Ltd. has grown its earnings per share (EPS) by an average of 45% per year (using a line of best fit). Its revenue is up 45% over last year.

This demonstrates that the company has been improving recently. A good result. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Painted Pony Energy Ltd. Been A Good Investment?

Given the total loss of 89% over three years, many shareholders in Painted Pony Energy Ltd. are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We examined the amount Painted Pony Energy Ltd. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

However we must not forget that the EPS growth has been very strong over three years. However, the returns to investors are far less impressive, over the same period. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. So you may want to check if insiders are buying Painted Pony Energy shares with their own money (free access).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

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