How Much Is Nearmap Ltd (ASX:NEA) Paying Its CEO?

Rob Newman has been the CEO of Nearmap Ltd (ASX:NEA) since 2015, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Nearmap.

See our latest analysis for Nearmap

How Does Total Compensation For Rob Newman Compare With Other Companies In The Industry?

According to our data, Nearmap Ltd has a market capitalization of AU$1.1b, and paid its CEO total annual compensation worth AU$1.1m over the year to June 2020. We note that's a decrease of 17% compared to last year. We note that the salary portion, which stands at AU$584.6k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the same industry with market capitalizations ranging between AU$518m and AU$2.1b had a median total CEO compensation of AU$1.2m. From this we gather that Rob Newman is paid around the median for CEOs in the industry. What's more, Rob Newman holds AU$21m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, roughly 60% of total compensation represents salary and 40% is other remuneration. Nearmap is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Nearmap Ltd's Growth

Over the last three years, Nearmap Ltd has shrunk its earnings per share by 57% per year. Its revenue is up 24% over the last year.

The decrease in EPS could be a concern for some investors. But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Nearmap Ltd Been A Good Investment?

We think that the total shareholder return of 214%, over three years, would leave most Nearmap Ltd shareholders smiling. 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.

In Summary...

As we noted earlier, Nearmap pays its CEO in line with similar-sized companies belonging to the same industry. The company has logged solid shareholder returns for the past three years. Revenues have also showed some positive momentum, recently. On a worrying note, its important to acknowledge that EPS growth has been negative recently. Considering overall performance, it's fair to say Rob is paid reasonably.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 3 warning signs for Nearmap that investors should be aware of in a dynamic business environment.

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.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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