In 2010 Jordan Luckett was appointed CEO of Great Western Exploration Limited (ASX:GTE). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Jordan Luckett’s Compensation Compare With Similar Sized Companies?
According to our data, Great Western Exploration Limited has a market capitalization of AU$3.8m, and paid its CEO total annual compensation worth AU$284k over the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at AU$250k. We took a group of companies with market capitalizations below AU$298m, and calculated the median CEO total compensation to be AU$380k.
That means Jordan Luckett receives fairly typical remuneration for the CEO of a company that size. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at Great Western Exploration has changed from year to year.
Is Great Western Exploration Limited Growing?
Over the last three years Great Western Exploration Limited has grown its earnings per share (EPS) by an average of 87% per year (using a line of best fit). It achieved revenue growth of 78% over the last year.
This demonstrates that the company has been improving recently. A good result. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. Although we don’t have analyst forecasts you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Great Western Exploration Limited Been A Good Investment?
Given the total loss of 86% over three years, many shareholders in Great Western Exploration Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
Remuneration for Jordan Luckett is close enough to the median pay for a CEO of a similar sized company .
We think that the EPS growth is very pleasing, but it’s disappointing to see negative shareholder returns over three years. Considering the the positives we don’t think the CEO pays is too high, but it’s certainly hard to argue it is too low. Whatever your view on compensation, you might want to check if insiders are buying or selling Great Western Exploration shares (free trial).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
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