Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
In 2013 Trevor Mather was appointed CEO of Auto Trader Group plc (LON:AUTO). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
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£4.2b, and is paying total annual CEO compensation of UK£2.6m. (This number is for the twelve months until 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at UK£546k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£3.1b to UK£9.2b. The median total CEO compensation was UK£2.5m.
So Trevor Mather receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at Auto Trader Group has changed over time.
Is Auto Trader Group plc Growing?
On average over the last three years, Auto Trader Group plc has grown earnings per share (EPS) by 27% each year (using a line of best fit). It achieved revenue growth of 6.0% over the last year.
This demonstrates that the company has been improving recently. A good result. 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?
I think that the total shareholder return of 34%, over three years, would leave most Auto Trader Group plc shareholders smiling. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.
Trevor Mather is paid around what is normal the leaders of comparable size 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! Whatever your view on compensation, you might want to check if insiders are buying or selling Auto Trader Group shares (free trial).
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.
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 email@example.com.