Yahoo Finance How Should Investors React To Science in Sport plc's (LON:SIS) CEO Pay?
Steve Moon is the CEO of Science in Sport plc (LON:SIS). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Science in Sport
How Does Steve Moon's Compensation Compare With Similar Sized Companies?
Our data indicates that Science in Sport plc is worth UK£37m, and total annual CEO compensation was reported as UK£1.0m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at UK£270k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We looked at a group of companies with market capitalizations under UK£163m, and the median CEO total compensation was UK£274k.
Now let's take a look at the pay mix on an industry and company level to gain a better understanding of where Science in Sport stands. On an industry level, roughly 47% of total compensation represents salary and 53% is other remuneration. Readers will want to know that Science in Sport pays a modest slice of remuneration through salary, as compared to the wider sector.
It would therefore appear that Science in Sport plc pays Steve Moon more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. You can see, below, how CEO compensation at Science in Sport has changed over time.
Is Science in Sport plc Growing?
Over the last three years Science in Sport plc has seen earnings per share (EPS) move in a positive direction by an average of 12% per year (using a line of best fit). In the last year, its revenue is up 137%.
This demonstrates that the company has been improving recently. A good result. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. Shareholders might be interested in this free visualization of analyst forecasts.
Has Science in Sport plc Been A Good Investment?
With a three year total loss of 66%, Science in Sport plc would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
We compared the total CEO remuneration paid by Science in Sport plc, and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
However, the earnings per share growth over three years is certainly impressive. Having said that, shareholders may be disappointed with the weak returns over the last three years. Considering positive per-share earnings movement, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. CEO compensation is an important area to keep your eyes on, but we've also identified 5 warning signs for Science in Sport (2 shouldn't be ignored!) that you should be aware of before investing here.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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.
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. Thank you for reading.
