How Should Investors React To Roxgold Inc.'s (TSE:ROXG) CEO Pay?

Simply Wall St
0

Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

John Dorward has been the CEO of Roxgold Inc. (TSE:ROXG) since 2012. 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. 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.

See our latest analysis for Roxgold

How Does John Dorward's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Roxgold Inc. has a market cap of CA$327m, and is paying total annual CEO compensation of US$1.6m. (This number is for the twelve months until December 2017). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$525k. We looked at a group of companies with market capitalizations from CA$134m to CA$538m, and the median CEO total compensation was CA$897k.

As you can see, John Dorward is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Roxgold Inc. is paying too much. 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 Roxgold has changed from year to year.

TSX:ROXG CEO Compensation, May 7th 2019
TSX:ROXG CEO Compensation, May 7th 2019

Is Roxgold Inc. Growing?

Over the last three years Roxgold Inc. has grown its earnings per share (EPS) by an average of 91% per year (using a line of best fit). In the last year, its revenue is up 5.9%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.

Has Roxgold Inc. Been A Good Investment?

Given the total loss of 31% over three years, many shareholders in Roxgold Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared total CEO remuneration at Roxgold Inc. with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within 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. Considering the per share profit growth, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Roxgold.

Important note: Roxgold 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.

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.

Advertisement

Recommended Stories

  • Can I Use My RMDs to Transfer Money Into My Roth IRA?

    If you're taking a required minimum distribution from an IRA, 401(k) or other tax-deferred account and don't need the money to cover living expenses, where should you stash that unneeded cash? Investors now need to start taking RMDs at age 73 or, if they were born after 1960, at age 75. Depending on the balances of […] The post Can I Use My RMDs to Transfer Money Into My Roth IRA? appeared first on SmartReads by SmartAsset.

  • Billionaire Bill Gates Has 51% of His Portfolio Invested in 2 Brilliant Stocks

    The Bill and Melinda Gates Foundation Trust outperformed the S&P 500 by a wide margin over the past three years, in part because of these two stocks.

  • Morgan Stanley Predicts up to 110% Rally for These 2 ‘Strong Buy’ Stocks

    Uncertainty is the word of the day, in reference to the near-term economic future. Sentiment will hinge on the inflation numbers due out next week. March’s figure rose to 3.5%, and April’s job numbers showed a marked slowing in the labor market; that combination has stoked fears of stagflation. But – corporate earnings from Q1 are beating expectations, and the stock market has taken a turn for the better with the S&P 500 closing just below 5,200 yesterday. Economic strategists are still optimist

  • Moderna's New RSV Vaccine Undercuts the Promise of mRNA

    (Bloomberg) -- Moderna Inc.’s pioneering Covid shot turned the company into a nearly $200 billion biotech giant and a public health hero. Its second vaccine, meant to prevent a common respiratory virus, is calling into question the premise on which the company has staked its entire business. Most Read from BloombergMicrosoft’s Xbox Is Planning More Cuts After Studio ClosingsAmericans Are Racking Up ‘Phantom Debt’ That Wall Street Can’t TrackStormy Daniels Will Return to Court in Test of Trump’s

  • Here's Exactly When Social Security Recipients Can Expect Benefit Cuts, According to the Latest Trustees Report

    Social Security payments may be subject to cuts. Here's what the timing looks like.

  • How Much Cash Can A $300,000 Annuity Generate For Me Each Month?

    Imagine having a reliable source of income you can count on throughout your retirement. That’s the promise of an annuity. These insurance products have been designed to turn your savings into a steady stream of monthly payments. They guarantee peace of mind and financial security in your golden years. Don't Miss: Are you rich? Here’s what Americans think you need to be considered wealthy. Can you guess how many Americans successfully retire with $1,000,000 saved? The percentage may shock you. An

  • 1 Vanguard ETF That Can Serve as a Complete Stock Portfolio

    This single Vanguard ETF provides a straightforward path to a secure retirement.

  • Too many tractors: As boom times fade, farm equipment piles up

    Falling crop prices are leaving agriculture equipment sellers with an excess of unsold tractors and combines. The slower equipment sales are a knock-on effect of corn and soy prices dropping to more than three-year lows as U.S. farm income plummets and equipment makers and dealers are forced to pivot quickly after a period of booming business. Reuters interviewed ten equipment dealers, mostly in the Midwest, as well as farmers and analysts, who said low crop prices combined with persistently high interest rates are deterring farmers from purchasing machinery.

  • Stocks could tank after an ill-advised 'melt-up' if the Fed cuts rates to avoid recession

    "Investors' expectation that the Fed would nip a recession in the bud by easing means that the Fed Put is back," Ed Yardeni said.

  • Roblox Stock Plunges On Firm's Weak Outlook. Investors Say 'Game Over.'

    Video game platform Roblox beat estimates for the first quarter but guided below views for the current quarter and full year. Roblox stock plummeted on the news.