Yahoo Finance Is Porvair plc (LON:PRV) Overpaying Its CEO?
Ben D. Stocks has been the CEO of Porvair plc (LON:PRV) since 1998. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for Porvair
How Does Ben D. Stocks's Compensation Compare With Similar Sized Companies?
According to our data, Porvair plc has a market capitalization of UK£266m, and paid its CEO total annual compensation worth UK£1.1m over the year to November 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at UK£305k. 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 from UK£153m to UK£611m, and the median CEO total compensation was UK£685k.
It would therefore appear that Porvair plc pays Ben D. Stocks 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. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Porvair has changed over time.
Is Porvair plc Growing?
On average over the last three years, Porvair plc has grown earnings per share (EPS) by 13% each year (using a line of best fit). Its revenue is up 17% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Porvair plc Been A Good Investment?
Most shareholders would probably be pleased with Porvair plc for providing a total return of 35% 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...
We examined the amount Porvair plc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. On top of that, in the same period, returns to shareholders have been great. As a result of this good performance, the CEO remuneration may well be quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling Porvair shares (free trial).
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.
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.
