In 2015 Nick Beighton was appointed CEO of ASOS Plc (LON:ASC). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. This method should give us information to assess how appropriately the company pays the CEO.
How Does Nick Beighton's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that ASOS Plc has a market cap of UK£3.0b, and reported total annual CEO compensation of UK£797k for the year to August 2019. That's actually a decrease on the year before. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at UK£565k. We examined companies with market caps from UK£1.6b to UK£5.0b, and discovered that the median CEO total compensation of that group was UK£1.8m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see a visual representation of the CEO compensation at ASOS, below.
Is ASOS Plc Growing?
ASOS Plc has increased its earnings per share (EPS) by an average of 6.7% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 13%.
I think the revenue growth is good. And, while modest, the earnings per share growth is noticeable. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. It could be important to check this free visual depiction of what analysts expect for the future.
Has ASOS Plc Been A Good Investment?
Given the total loss of 33% over three years, many shareholders in ASOS Plc are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
ASOS Plc is currently paying its CEO below what is normal for companies of its size.
Nick Beighton is paid less than CEOs of similar size companies, but growth hasn't been particularly impressive and the total shareholder return over three years would leave many disappointed. Many shareholders would probably like to see improvements, but our analysis does not suggest that CEO compensation is too generous. So you may want to check if insiders are buying ASOS shares with their own money (free access).
If you want to buy a stock that is better than ASOS, this free list of high return, low debt companies is a great place to look.
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