Is Condor Petroleum Inc’s (TSE:CPI) CEO Salary Justified?

In 2008 Don Streu was appointed CEO of Condor Petroleum Inc (TSE:CPI). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Condor Petroleum

How Does Don Streu’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Condor Petroleum Inc has a market cap of CA$9.3m, and is paying total annual CEO compensation of CA$375k. (This number is for the twelve months until 2017). It is worth noting that the CEO compensation consists almost entirely of the salary, worth CA$375k. We took a group of companies with market capitalizations below CA$266m, and calculated the median CEO compensation to be CA$156k.

Thus we can conclude that Don Streu receives more in total compensation than the median of a group of companies in the same market, and of similar size to Condor Petroleum Inc. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. Take a look at Condor Petroleum’s key growth metrics by clicking on this link to view earnings, revenue and cash flow.

You can see, below, how CEO compensation at Condor Petroleum has changed over time.

TSX:CPI CEO Compensation December 3rd 18
TSX:CPI CEO Compensation December 3rd 18

Is Condor Petroleum Inc Growing?

Condor Petroleum Inc has reduced its earnings per share by an average of 32% a year, over the last three years. Its revenue is up 167% over last year.

As investors, we are a bit wary of companies that have lower earnings per share, over three years. But on the other hand, revenue growth is strong, suggesting a brighter future. These two metric are moving in different directions, so while it’s hard to be confident judging performance, we think the stock is worth watching.

Has Condor Petroleum Inc Been A Good Investment?

With a three year total loss of 68%, Condor Petroleum Inc would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

We compared the total CEO remuneration paid by Condor Petroleum Inc, 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.

Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Condor Petroleum (free visualization of insider trades).

If you want to buy a stock that is better than Condor Petroleum, this free list of high return, low debt companies is a great place to look.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.