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In 2015 Temogen Hield was appointed CEO of DataDot Technology Limited (ASX:DDT). 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 – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Temogen Hield’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that DataDot Technology Limited has a market cap of AU$9.7m, and is paying total annual CEO compensation of AU$336k. (This number is for the twelve months until June 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at AU$251k. We took a group of companies with market capitalizations below AU$287m, and calculated the median CEO total compensation to be AU$354k.
So Temogen Hield receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at DataDot Technology has changed over time.
Is DataDot Technology Limited Growing?
DataDot Technology Limited has reduced its earnings per share by an average of 2.6% a year, over the last three years (measured with a line of best fit). It saw its revenue drop -17% over the last year.
Unfortunately there is a complete lack of earnings per share improvement, over three years. And the impression is worse when you consider revenue is down year-on-year. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don’t have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has DataDot Technology Limited Been A Good Investment?
Given the total loss of 43% over three years, many shareholders in DataDot Technology Limited are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
Temogen Hield is paid around the same as most CEOs of similar size companies.
The company isn’t growing EPS, and shareholder returns have been disappointing. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. So you may want to check if insiders are buying DataDot Technology shares with their own money (free access).
Important note: DataDot Technology may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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 email@example.com. 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.