Is Steadfast Group Limited's (ASX:SDF) CEO Being Overpaid?
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
In 1996 Robert Kelly was appointed CEO of Steadfast Group Limited (ASX:SDF). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Steadfast Group
How Does Robert Kelly's Compensation Compare With Similar Sized Companies?
According to our data, Steadfast Group Limited has a market capitalization of AU$2.7b, and pays its CEO total annual compensation worth AU$3.1m. (This figure is for the year to June 2018). While we always look at total compensation first, we note that the salary component is less, at AU$974k. When we examined a selection of companies with market caps ranging from AU$1.5b to AU$4.7b, we found the median CEO total compensation was AU$2.4m.
So Robert Kelly is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at Steadfast Group has changed over time.
Is Steadfast Group Limited Growing?
Steadfast Group Limited saw earnings per share stay pretty flat over the last three years, albeit with a slight positive trend. It achieved revenue growth of 19% over the last year.
This revenue growth could really point to a brighter future. And, while modest, the earnings per share growth is noticeable. So while performance isn't amazing, we think it really does seem quite respectable. It could be important to check this free visual depiction of what analysts expect for the future.
Has Steadfast Group Limited Been A Good Investment?
Most shareholders would probably be pleased with Steadfast Group Limited for providing a total return of 78% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
Remuneration for Robert Kelly is close enough to the median pay for a CEO of a similar sized company .
While the growth could be better, the shareholder returns are clearly good. So considering most shareholders would be happy, we'd say the CEO pay is appropriate. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Steadfast Group (free visualization of insider trades).
If you want to buy a stock that is better than Steadfast Group, 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.
