Why We Think Bridgemarq Real Estate Services Inc.'s (TSE:BRE) CEO Compensation Is Not Excessive At All

Performance at Bridgemarq Real Estate Services Inc. (TSE:BRE) has been rather uninspiring recently and shareholders may be wondering how CEO Spencer Enright plans to fix this. At the next AGM coming up on 11 May 2021, they can influence managerial decision making through voting on resolutions, including executive remuneration. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We have prepared some analysis below to show that CEO compensation looks to be reasonable.

See our latest analysis for Bridgemarq Real Estate Services

Comparing Bridgemarq Real Estate Services Inc.'s CEO Compensation With the industry

According to our data, Bridgemarq Real Estate Services Inc. has a market capitalization of CA$216m, and paid its CEO total annual compensation worth CA$229k over the year to December 2020. That's mostly flat as compared to the prior year's compensation. We note that the salary of CA$118.6k makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from CA$123m to CA$493m, the reported median CEO total compensation was CA$1.1m. Accordingly, Bridgemarq Real Estate Services pays its CEO under the industry median.

On an industry level, roughly 54% of total compensation represents salary and 46% is other remuneration. There isn't a significant difference between Bridgemarq Real Estate Services and the broader market, in terms of salary allocation in the overall compensation package. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Bridgemarq Real Estate Services Inc.'s Growth

Over the last three years, Bridgemarq Real Estate Services Inc. has shrunk its earnings per share by 60% per year. In the last year, its revenue is down 9.1%.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Bridgemarq Real Estate Services Inc. Been A Good Investment?

With a total shareholder return of 29% over three years, Bridgemarq Real Estate Services Inc. shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

While it's true that shareholders have seen decent returns, it's hard to overlook the lack of earnings growth and this makes us wonder if the current returns can continue. These are are some concerns that shareholders may want to address the board when they revisit their investment thesis.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for Bridgemarq Real Estate Services (2 don't sit too well with us!) that you should be aware of before investing here.

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

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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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