Is Noni B Limited’s (ASX:NBL) CEO Being Overpaid?

Scott Evans has been the CEO of Noni B Limited (ASX:NBL) since 2014. 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. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Noni B

How Does Scott Evans’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Noni B Limited has a market cap of AU$301m, and is paying total annual CEO compensation of AU$1.2m. (This figure is for the year to July 2018). While we always look at total compensation first, we note that the salary component is less, at AU$784k. We looked at a group of companies with market capitalizations from AU$142m to AU$567m, and the median CEO total compensation was AU$754k.

Thus we can conclude that Scott Evans receives more in total compensation than the median of a group of companies in the same market, and of similar size to Noni B Limited. However, this doesn’t necessarily mean the pay is too high. 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 Noni B, below.

ASX:NBL CEO Compensation, March 15th 2019
ASX:NBL CEO Compensation, March 15th 2019

Is Noni B Limited Growing?

Noni B Limited has increased its earnings per share (EPS) by an average of 66% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 75%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. You might want to check this free visual report on analyst forecasts for future earnings.

Has Noni B Limited Been A Good Investment?

Most shareholders would probably be pleased with Noni B Limited for providing a total return of 228% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary…

We examined the amount Noni B Limited pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

However, the earnings per share growth over three years is certainly impressive. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Noni B.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.