Trevor Mather has been the CEO of Auto Trader Group plc (LON:AUTO) since 2013. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Trevor Mather's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Auto Trader Group plc has a market cap of UK£4.8b, and is paying total annual CEO compensation of UK£1.9m. (This is based on the year to March 2019). That's less than last year. We think total compensation is more important but we note that the CEO salary is lower, at UK£557k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£3.2b to UK£9.7b. The median total CEO compensation was UK£2.8m.
Most shareholders would consider it a positive that Trevor Mather takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it's important we delve into the performance of the actual business.
You can see, below, how CEO compensation at Auto Trader Group has changed over time.
Is Auto Trader Group plc Growing?
Auto Trader Group plc has increased its earnings per share (EPS) by an average of 15% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 7.6%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. It could be important to check this free visual depiction of what analysts expect for the future.
Has Auto Trader Group plc Been A Good Investment?
Most shareholders would probably be pleased with Auto Trader Group plc for providing a total return of 37% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Auto Trader Group plc is currently paying its CEO below what is normal for companies of its size. Considering the underlying business is growing earnings, this would suggest the pay is modest. The strong history of shareholder returns might even have some thinking that Trevor Mather deserves a raise!
It is relatively rare to see a modestly paid CEO when performance is so impressive. But it is even better if company insiders are also buying shares with their own money. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Auto Trader Group (free visualization of insider trades).
If you want to buy a stock that is better than Auto Trader 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 firstname.lastname@example.org. 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.