How Much Is Questerre Energy Corporation (TSE:QEC) Paying Its CEO?

This article will reflect on the compensation paid to Michael Binnion who has served as CEO of Questerre Energy Corporation (TSE:QEC) since 2000. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

Check out our latest analysis for Questerre Energy

How Does Total Compensation For Michael Binnion Compare With Other Companies In The Industry?

Our data indicates that Questerre Energy Corporation has a market capitalization of CA$51m, and total annual CEO compensation was reported as CA$647k for the year to December 2019. We note that's an increase of 18% above last year. In particular, the salary of CA$324.5k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below CA$266m, we found that the median total CEO compensation was CA$369k. Accordingly, our analysis reveals that Questerre Energy Corporation pays Michael Binnion north of the industry median. Moreover, Michael Binnion also holds CA$1.4m worth of Questerre Energy stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 43% of total compensation represents salary and 57% is other remuneration. Questerre Energy pays out 50% of remuneration in the form of a salary, significantly higher than the industry average. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Questerre Energy Corporation's Growth

Over the past three years, Questerre Energy Corporation has seen its earnings per share (EPS) grow by 39% per year. Its revenue is up 6.9% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Questerre Energy Corporation Been A Good Investment?

Given the total shareholder loss of 86% over three years, many shareholders in Questerre Energy Corporation are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we noted earlier, Questerre Energy pays its CEO higher than the norm for similar-sized companies belonging to the same industry. However, we must not forget that the EPS growth has been very strong, but it's disappointing to see negative shareholder returns over the same period. Considering overall performance, we can't say Michael is underpaid, in fact compensation is definitely on the higher side.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Questerre Energy that investors should think about before committing capital to this stock.

Important note: Questerre Energy is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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