Does Talisman Mining Limited's (ASX:TLM) CEO Salary Compare Well With Others?

Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

In 2016 Dan Madden was appointed CEO of Talisman Mining Limited (ASX:TLM). 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 - 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.

See our latest analysis for Talisman Mining

How Does Dan Madden's Compensation Compare With Similar Sized Companies?

According to our data, Talisman Mining Limited has a market capitalization of AU$42m, and pays its CEO total annual compensation worth AU$660k. (This number is for the twelve months until 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at AU$350k. We looked at a group of companies with market capitalizations under AU$282m, and the median CEO compensation was AU$363k.

As you can see, Dan Madden is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Talisman Mining Limited is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see a visual representation of the CEO compensation at Talisman Mining, below.

Is Talisman Mining Limited Growing?

On average over the last three years, Talisman Mining Limited has shrunk earnings per share by 11% each year (measured with a line of best fit). Its revenue is down -85% over last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Talisman Mining Limited Been A Good Investment?

Since shareholders would have lost about 36% over three years, some Talisman Mining Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We compared the total CEO remuneration paid by Talisman Mining Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.

Over the same period, investors would have come away with nothing in the way of share price gains. Some might well form the view that the CEO is paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Talisman Mining (free visualization of insider trades).

Arguably, business quality is much more important than CEO compensation levels. So check out this freelist of interesting companies, that have HIGH return on equity and low debt.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.

Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.