Ben Laurance is the CEO of Axiom Properties Limited (ASX:AXI). 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for Axiom Properties
How Does Ben Laurance's Compensation Compare With Similar Sized Companies?
Our data indicates that Axiom Properties Limited is worth AU$17m, and total annual CEO compensation is AU$781k. (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$502k. We took a group of companies with market capitalizations below AU$285m, and calculated the median CEO compensation to be AU$357k.
It would therefore appear that Axiom Properties Limited pays Ben Laurance more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Axiom Properties has changed from year to year.
Is Axiom Properties Limited Growing?
Over the last three years Axiom Properties Limited has grown its earnings per share (EPS) by an average of 32% per year (using a line of best fit). Its revenue is down -66% over last year.
This demonstrates that the company has been improving recently. A good result. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Although we don't have analyst forecasts, you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Axiom Properties Limited Been A Good Investment?
Axiom Properties Limited has served shareholders reasonably well, with a total return of 25% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
In Summary...
We compared the total CEO remuneration paid by Axiom Properties Limited, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong over three years. Looking at the same time period, we think that the shareholder returns are respectable. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. Whatever your view on compensation, you might want to check if insiders are buying or selling Axiom Properties shares (free trial).
If you want to buy a stock that is better than Axiom Properties, this freelist of high return, low debt companies is a great place to look.
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.