Does Invigor Group Limited’s (ASX:IVO) CEO Pay Matter?

Gary Cohen is the CEO of Invigor Group Limited (ASX:IVO). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. 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.

Check out our latest analysis for Invigor Group

How Does Gary Cohen’s Compensation Compare With Similar Sized Companies?

According to our data, Invigor Group Limited has a market capitalization of AU$7.8m, and pays its CEO total annual compensation worth AU$394k. (This figure is for the year to December 2017). While we always look at total compensation first, we note that the salary component is less, at AU$300k. We examined a group of similar sized companies, with market capitalizations of below AU$280m. The median CEO total compensation in that group is AU$354k.

So Gary Cohen receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.

You can see, below, how CEO compensation at Invigor Group has changed over time.

ASX:IVO CEO Compensation, March 28th 2019
ASX:IVO CEO Compensation, March 28th 2019

Is Invigor Group Limited Growing?

Invigor Group Limited has increased its earnings per share (EPS) by an average of 16% a year, over the last three years (using a line of best fit). Its revenue is down -69% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Revenue growth is a real positive for growth, but ultimately profits are more important. We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Invigor Group Limited Been A Good Investment?

With a three year total loss of 93%, Invigor Group Limited would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

Gary Cohen is paid around what is normal the leaders of comparable size companies.

We think that the EPS growth is very pleasing, but we find the returns over the last three years to be lacking. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Invigor Group.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity 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 editorial-team@simplywallst.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.