Is Global Daily Fantasy Sports Inc.'s (CVE:DFS) CEO Overpaid Relative To Its Peers?

Darcy Krogh became the CEO of Global Daily Fantasy Sports Inc. (CVE:DFS) in 2016. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Global Daily Fantasy Sports

How Does Darcy Krogh's Compensation Compare With Similar Sized Companies?

According to our data, Global Daily Fantasy Sports Inc. has a market capitalization of CA$15m, and paid its CEO total annual compensation worth CA$120k over the year to December 2018. Notably, the salary of CA$120k is the vast majority of the CEO compensation. We examined a group of similar sized companies, with market capitalizations of below CA$271m. The median CEO total compensation in that group is CA$217k.

Now let's take a look at the pay mix on an industry and company level to gain a better understanding of where Global Daily Fantasy Sports stands. Talking in terms of the sector, salary represented approximately 98% of total compensation out of all the companies we analysed, while other remuneration made up 2.0% of the pie. Speaking on a company level, Global Daily Fantasy Sports prefers to tread along a traditional path, disbursing all compensation through a salary.

At first glance this seems like a real positive for shareholders, since Darcy Krogh is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion. You can see, below, how CEO compensation at Global Daily Fantasy Sports has changed over time.

Is Global Daily Fantasy Sports Inc. Growing?

On average over the last three years, Global Daily Fantasy Sports Inc. has shrunk earnings per share by 22% each year (measured with a line of best fit). It saw its revenue drop 96% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Global Daily Fantasy Sports Inc. Been A Good Investment?

Given the total loss of 61% over three years, many shareholders in Global Daily Fantasy Sports Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

It looks like Global Daily Fantasy Sports Inc. pays its CEO less than similar sized companies.

Darcy Krogh is paid less than CEOs of similar size companies, but the company isn't growing and total shareholder returns have been disappointing. While one could argue it is appropriate for the CEO to be paid less than other CEOs of similar sized companies, given company performance, we would not call the pay overly generous. On another note, Global Daily Fantasy Sports has 6 warning signs (and 4 which are significant) we think you should know about.

If you want to buy a stock that is better than Global Daily Fantasy Sports, this free list of high return, low debt companies is a great place to look.

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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. Thank you for reading.