Lee Rochford has been the CEO of Arrow Global Group PLC (LON:ARW) since 2017. 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.
How Does Lee Rochford's Compensation Compare With Similar Sized Companies?
Our data indicates that Arrow Global Group PLC is worth UK£340m, and total annual CEO compensation is UK£1.0m. (This is based on the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at UK£436k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£163m to UK£652m. The median total CEO compensation was UK£712k.
As you can see, Lee Rochford is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Arrow Global Group PLC is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Arrow Global Group has changed over time.
Is Arrow Global Group PLC Growing?
Arrow Global Group PLC has increased its earnings per share (EPS) by an average of 19% a year, over the last three years (using a line of best fit). It achieved revenue growth of 10.0% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.
Has Arrow Global Group PLC Been A Good Investment?
With a three year total loss of 12%, Arrow Global Group PLC would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We examined the amount Arrow Global Group PLC pays its CEO, and compared it to the amount paid by 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. However, the returns to investors are far less impressive, over the same period. Considering the per share profit growth, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Arrow Global Group (free visualization of insider trades).
Important note: Arrow Global Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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