Yahoo Finance Here's Why PWR Holdings Limited's (ASX:PWH) CEO May Deserve A Raise
Shareholders will be pleased by the impressive results for PWR Holdings Limited (ASX:PWH) recently and CEO Kees Weel has played a key role. This would be kept in mind at the upcoming AGM on 29 October 2021 which will be a chance for them to hear the board review the financial results, discuss future company strategy and vote on resolutions such as executive remuneration and other matters. Let's take a look at why we think the CEO has done a good job and we'll present the case for a bump in pay.
View our latest analysis for PWR Holdings
Comparing PWR Holdings Limited's CEO Compensation With the industry
According to our data, PWR Holdings Limited has a market capitalization of AU$925m, and paid its CEO total annual compensation worth AU$547k over the year to June 2021. We note that's a decrease of 15% compared to last year. Notably, the salary which is AU$475.0k, represents most of the total compensation being paid.
On examining similar-sized companies in the industry with market capitalizations between AU$534m and AU$2.1b, we discovered that the median CEO total compensation of that group was AU$783k. This suggests that Kees Weel is paid below the industry median. Moreover, Kees Weel also holds AU$187m worth of PWR Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2021 | 2020 | Proportion (2021) |
Salary | AU$475k | AU$450k | 87% |
Other | AU$72k | AU$194k | 13% |
Total Compensation | AU$547k | AU$644k | 100% |
On an industry level, roughly 77% of total compensation represents salary and 23% is other remuneration. It's interesting to note that PWR Holdings pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
PWR Holdings Limited's Growth
PWR Holdings Limited has seen its earnings per share (EPS) increase by 15% a year over the past three years. Its revenue is up 21% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has PWR Holdings Limited Been A Good Investment?
Most shareholders would probably be pleased with PWR Holdings Limited for providing a total return of 175% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
To Conclude...
Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for PWR Holdings that investors should think about before committing capital to this stock.
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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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