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Is Transurban Group’s (ASX:TCL) CEO Paid Enough Relative To Peers?

Scott Charlton has been the CEO of Transurban Group (ASX:TCL) since 2012. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. Then we’ll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Transurban Group

How Does Scott Charlton’s Compensation Compare With Similar Sized Companies?

Our data indicates that Transurban Group is worth AU$32b, and total annual CEO compensation is AU$7.1m. (This is based on the year to 2018). That’s just a smallish increase of 6.8% on last year. We think total compensation is more important but we note that the CEO salary is lower, at AU$2.2m. We took a group of companies with market capitalizations over AU$11b, and calculated the median CEO compensation to be AU$5.9m. There aren’t very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.

That means Scott Charlton receives fairly typical remuneration for the CEO of a large company. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at Transurban Group, below.

ASX:TCL CEO Compensation December 13th 18

Is Transurban Group Growing?

Transurban Group has increased its earnings per share (EPS) by an average of 89% a year, over the last three years In the last year, its revenue is up 21%.

This demonstrates that the company has been improving recently. A good result. 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 Transurban Group Been A Good Investment?

Most shareholders would probably be pleased with Transurban Group for providing a total return of 39% 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…

Scott Charlton is paid around the same as most CEOs of large companies.

Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Indeed, many might consider the pay rather modest, given the solid company performance! So you may want to check if insiders are buying Transurban Group shares with their own money (free access).

Or you might prefer this data-rich interactive visualization of historic revenue and earnings.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.