Is Tamarack Valley Energy Ltd’s (TSE:TVE) CEO Being Overpaid?

In 2010 Brian Schmidt was appointed CEO of Tamarack Valley Energy Ltd (TSE:TVE). 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 – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Tamarack Valley Energy

How Does Brian Schmidt’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Tamarack Valley Energy Ltd has a market cap of CA$517m, and is paying total annual CEO compensation of CA$1.4m. (This number is for the twelve months until 2017). While we always look at total compensation first, we note that the salary component is less, at CA$323k. When we examined a selection of companies with market caps ranging from CA$273m to CA$1.1b, we found the median CEO compensation was CA$1.4m.

So Brian Schmidt receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance. So this free visual report on analyst forecasts could hold they key to an excellent investment decision.

You can see a visual representation of the CEO compensation at Tamarack Valley Energy, below.

TSX:TVE CEO Compensation January 2nd 19
TSX:TVE CEO Compensation January 2nd 19

Is Tamarack Valley Energy Ltd Growing?

Tamarack Valley Energy Ltd has increased its earnings per share (EPS) by an average of 89% a year, over the last three years It achieved revenue growth of 78% over the last year.

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.

Has Tamarack Valley Energy Ltd Been A Good Investment?

Since shareholders would have lost about 24% over three years, some Tamarack Valley Energy Ltd shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

Brian Schmidt is paid around the same as most CEOs of similar size companies.

We like that the company is growing EPS, but we find the returns over the last three years to be lacking. Considering the the positives we don’t think the CEO pays is too high, but it’s certainly hard to argue it is too low. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Tamarack Valley Energy (free visualization of insider trades).

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.

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.