Yahoo Finance Does Toromont Industries Ltd.'s (TSE:TIH) CEO Salary Compare Well With Others?
Scott Medhurst became the CEO of Toromont Industries Ltd. (TSE:TIH) in 2012. 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 method should give us information to assess how appropriately the company pays the CEO.
View our latest analysis for Toromont Industries
How Does Scott Medhurst's Compensation Compare With Similar Sized Companies?
According to our data, Toromont Industries Ltd. has a market capitalization of CA$5.3b, and paid its CEO total annual compensation worth CA$3.6m over the year to December 2019. That's actually a decrease on the year before. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at CA$792k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations from CA$2.8b to CA$9.0b, and the median CEO total compensation was CA$4.2m.
Now let's take a look at the pay mix on an industry and company level to gain a better understanding of where Toromont Industries stands. Speaking on an industry level, we can see that nearly 54% of total compensation represents salary, while the remainder of 46% is other remuneration. Non-salary compensation represents a greater slice of the remuneration pie for Toromont Industries, in sharp contrast to the overall sector.
So Scott Medhurst is paid around the average of 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. You can see, below, how CEO compensation at Toromont Industries has changed over time.
Is Toromont Industries Ltd. Growing?
Over the last three years Toromont Industries Ltd. has seen earnings per share (EPS) move in a positive direction by an average of 22% per year (using a line of best fit). Its revenue is up 4.7% over last year.
This demonstrates that the company has been improving recently. A good result. 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 Toromont Industries Ltd. Been A Good Investment?
Most shareholders would probably be pleased with Toromont Industries Ltd. for providing a total return of 50% 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...
Scott Medhurst is paid around the same as most CEOs of similar size companies.
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. So one could argue the CEO compensation is quite modest, if you consider company performance! Looking into other areas, we've picked out 2 warning signs for Toromont Industries that investors should think about before committing capital to this stock.
Important note: Toromont Industries 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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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. Thank you for reading.
