Is Equiniti Group plc’s (LON:EQN) CEO Paid Enough Relative To Peers?
In 2014 Guy Wakeley was appointed CEO of Equiniti Group plc (LON:EQN). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Equiniti Group
How Does Guy Wakeley’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Equiniti Group plc has a market cap of UK£778m, and is paying total annual CEO compensation of UK£3.1m. (This figure is for the year to 2017). While we always look at total compensation first, we note that the salary component is less, at UK£460k. We examined companies with market caps from UK£317m to UK£1.3b, and discovered that the median CEO compensation of that group was UK£1.0m.
Thus we can conclude that Guy Wakeley receives more in total compensation than the median of a group of companies in the same market, and of similar size to Equiniti Group plc. However, this doesn’t necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Equiniti Group has changed from year to year.
Is Equiniti Group plc Growing?
On average over the last three years, Equiniti Group plc has grown earnings per share (EPS) by 155% each year. Its revenue is up 21% over last year.
This demonstrates that the company has been improving recently. A good result. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business.
You might want to check this free visual report on analyst forecasts for future earnings.
Has Equiniti Group plc Been A Good Investment?
Boasting a total shareholder return of 36% over three years, Equiniti Group plc has done well by shareholders. 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…
We examined the amount Equiniti Group plc 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.
Importantly, though, the company has impressed with its earnings per share growth, over three years. Even better, returns to shareholders have been plentiful, over the same time period. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. Shareholders may want to check for free if Equiniti Group insiders are buying or selling shares.
Or you could feast your eyes on this interactive graph depicting past earnings, cash flow 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.
