Should You Worry About Medlab Clinical Limited's (ASX:MDC) CEO Salary Level?

Sean Hall is the CEO of Medlab Clinical Limited (ASX:MDC). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Medlab Clinical

How Does Sean Hall's Compensation Compare With Similar Sized Companies?

Our data indicates that Medlab Clinical Limited is worth AU$101m, and total annual CEO compensation was reported as AU$328k for the year to June 2019. That's a fairly small increase of 0.04% on year before. While we always look at total compensation first, we note that the salary component is less, at AU$299k. We examined a group of similar sized companies, with market capitalizations of below AU$291m. The median CEO total compensation in that group is AU$363k.

So Sean Hall is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at Medlab Clinical has changed over time.

Is Medlab Clinical Limited Growing?

Medlab Clinical Limited has reduced its earnings per share by an average of 21% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 31%.

As investors, we are a bit wary of companies that have lower earnings per share, over three years. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. It's hard to reach a conclusion about business performance right now. This may be one to watch.

Has Medlab Clinical Limited Been A Good Investment?

Medlab Clinical Limited has served shareholders reasonably well, with a total return of 24% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary...

Remuneration for Sean Hall is close enough to the median pay for a CEO of a similar sized company .

We think many would like to see better growth. While the CEO may not be underpaid, we don't think the pay is too generous either. So you may want to check if insiders are buying Medlab Clinical shares with their own money (free access).

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.