In 2010 Scott Pritchard was appointed CEO of Precinct Properties New Zealand Limited (NZSE:PCT). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
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How Does Scott Pritchard's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Precinct Properties New Zealand Limited has a market cap of NZ$2.2b, and is paying total annual CEO compensation of NZ$1.7m. (This is based on the year to June 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at NZ$510k. We examined companies with market caps from NZ$1.5b to NZ$4.9b, and discovered that the median CEO total compensation of that group was NZ$1.9m.
So Scott Pritchard receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
The graphic below shows how CEO compensation at Precinct Properties New Zealand has changed from year to year.
Is Precinct Properties New Zealand Limited Growing?
On average over the last three years, Precinct Properties New Zealand Limited has grown earnings per share (EPS) by 26% each year (using a line of best fit). It achieved revenue growth of 1.6% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. You might want to check this free visual report on analyst forecasts for future earnings.
Has Precinct Properties New Zealand Limited Been A Good Investment?
Most shareholders would probably be pleased with Precinct Properties New Zealand Limited for providing a total return of 45% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Scott Pritchard is paid around what is normal the leaders of comparable size companies.
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Precinct Properties New Zealand (free visualization of insider trades).
Important note: Precinct Properties New Zealand may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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If you spot an error that warrants correction, please contact the editor at email@example.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.