In 2013 Paul Colborne was appointed CEO of Surge Energy Inc (TSE:SGY). 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Paul Colborne’s Compensation Compare With Similar Sized Companies?
According to our data, Surge Energy Inc has a market capitalization of CA$587m, and pays its CEO total annual compensation worth CA$2m. We note that’s an increase of 10% above last year. We looked at a group of companies with market capitalizations from CA$262m to CA$1.0b, and the median CEO compensation was CA$1m.
It would therefore appear that Surge Energy Inc pays Paul Colborne 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. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Surge Energy has changed from year to year.
Is Surge Energy Inc Growing?
Surge Energy Inc has increased its earnings per share (EPS) by an average of 98% a year, over the last three years It achieved revenue growth of 32% over the last year.
This demonstrates that the company has been improving recently. A good result. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. So this free visualization of the analyst consensus on future earnings could help you make the right decision about whether to buy, sell, or hold.
Has Surge Energy Inc Been A Good Investment?
Given the total loss of 30% over three years, many shareholders in Surge Energy Inc are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared total CEO remuneration at Surge Energy Inc with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
However, the earnings per share growth over three years is certainly impressive. However, the returns to investors are far less impressive, over the same period. This doesn’t look great when you consider CEO remuneration is up on last year. While EPS is positive, we’d say shareholders would want better returns before the CEO is paid much more. Sometimes, highly paid CEOs create a lot of value for shareholders. Still, shareholders might want to check if insiders have been selling.
If you would prefer check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
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 firstname.lastname@example.org.