Paul Rennie is the CEO of Paradigm Biopharmaceuticals Limited (ASX:PAR). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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 process should give us an idea about how appropriately the CEO is paid.
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How Does Paul Rennie’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Paradigm Biopharmaceuticals Limited has a market cap of AU$286m, and is paying total annual CEO compensation of AU$573k. (This number is for the twelve months until June 2018). We think total compensation is more important but we note that the CEO salary is lower, at AU$380k. We examined companies with market caps from AU$145m to AU$582m, and discovered that the median CEO total compensation of that group was AU$771k.
So Paul Rennie receives a similar amount to the median CEO pay, amongst 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 Paradigm Biopharmaceuticals has changed over time.
Is Paradigm Biopharmaceuticals Limited Growing?
Paradigm Biopharmaceuticals Limited has reduced its earnings per share by an average of 15% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 50%.
The reduction in earnings per share, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can’t form a strong opinion about business performance yet; but it’s one worth watching. You might want to check this free visual report on analyst forecasts for future earnings.
Has Paradigm Biopharmaceuticals Limited Been A Good Investment?
Boasting a total shareholder return of 378% over three years, Paradigm Biopharmaceuticals Limited has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
Remuneration for Paul Rennie is close enough to the median pay for a CEO of a similar sized company .
While we would like to see improved growth metrics, there is no doubt that the total returns have been great, over the last three years. So we can conclude that on this analysis the CEO compensation seems pretty sound. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Paradigm Biopharmaceuticals (free visualization of insider trades).
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 firstname.lastname@example.org. 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.