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Andrew Day has been the CEO of Keywords Studios plc (LON:KWS) since 2009. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Andrew Day's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Keywords Studios plc has a market cap of UK£1.0b, and is paying total annual CEO compensation of €252k. (This number is for the twelve months until December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at €230k. We looked at a group of companies with market capitalizations from €889m to €2.8b, and the median CEO total compensation was €1.5m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Keywords Studios has changed over time.
Is Keywords Studios plc Growing?
Over the last three years Keywords Studios plc has grown its earnings per share (EPS) by an average of 40% per year (using a line of best fit). It achieved revenue growth of 66% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Keywords Studios plc Been A Good Investment?
I think that the total shareholder return of 505%, over three years, would leave most Keywords Studios 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.
It looks like Keywords Studios plc pays its CEO less than similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. The strong history of shareholder returns might even have some thinking that Andrew Day deserves a raise!
Most shareholders like to see a modestly paid CEO combined with strong performance by the company. But it is even better if company insiders are also buying shares with their own money. Shareholders may want to check for free if Keywords Studios insiders are buying or selling shares.
If you want to buy a stock that is better than Keywords Studios, this free list of high return, low debt companies is a great place to look.
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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Thank you for reading.