Yahoo Finance Here's Why Shareholders May Want To Be Cautious With Increasing Ackroo Inc.'s (CVE:AKR) CEO Pay Packet
Key Insights
Ackroo's Annual General Meeting to take place on 7th of December
Total pay for CEO Steve Levely includes CA$180.0k salary
The total compensation is similar to the average for the industry
Over the past three years, Ackroo's EPS grew by 31% and over the past three years, the total loss to shareholders 40%
In the past three years, the share price of Ackroo Inc. (CVE:AKR) has struggled to grow and now shareholders are sitting on a loss. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 7th of December. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.
Check out our latest analysis for Ackroo
Comparing Ackroo Inc.'s CEO Compensation With The Industry
According to our data, Ackroo Inc. has a market capitalization of CA$12m, and paid its CEO total annual compensation worth CA$308k over the year to December 2022. That's mostly flat as compared to the prior year's compensation. Notably, the salary which is CA$180.0k, represents a considerable chunk of the total compensation being paid.
On comparing similar-sized companies in the Canadian Software industry with market capitalizations below CA$270m, we found that the median total CEO compensation was CA$327k. This suggests that Ackroo remunerates its CEO largely in line with the industry average. What's more, Steve Levely holds CA$827k worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2022 | 2021 | Proportion (2022) |
Salary | CA$180k | CA$180k | 58% |
Other | CA$128k | CA$129k | 42% |
Total Compensation | CA$308k | CA$309k | 100% |
Speaking on an industry level, nearly 72% of total compensation represents salary, while the remainder of 28% is other remuneration. Ackroo pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Ackroo Inc.'s Growth
Ackroo Inc. has seen its earnings per share (EPS) increase by 31% a year over the past three years. Its revenue is up 5.2% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Ackroo Inc. Been A Good Investment?
Few Ackroo Inc. shareholders would feel satisfied with the return of -40% over three years. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
Shareholders have not seen their shares grow in value, rather they have seen their shares decline. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.
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 5 warning signs for Ackroo (2 make us uncomfortable!) that you should be aware of before investing here.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
