This Is Why Stampede Drilling Inc.'s (CVE:SDI) CEO Compensation Looks Appropriate

Key Insights

• Stampede Drilling will host its Annual General Meeting on 16th of May
• Salary of CA$390.5k is part of CEO Lyle Whitmarsh's total remuneration
• The overall pay is comparable to the industry average
• Stampede Drilling's total shareholder return over the past three years was 9.5% while its EPS grew by 87% over the past three years

Performance at Stampede Drilling Inc. (CVE:SDI) has been reasonably good and CEO Lyle Whitmarsh has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 16th of May. We present our case of why we think CEO compensation looks fair.

See our latest analysis for Stampede Drilling

How Does Total Compensation For Lyle Whitmarsh Compare With Other Companies In The Industry?

At the time of writing, our data shows that Stampede Drilling Inc. has a market capitalization of CA$49m, and reported total annual CEO compensation of CA$739k for the year to December 2023. That's a notable decrease of 54% on last year. In particular, the salary of CA$390.5k, makes up a fairly large portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the Canadian Energy Services industry with market capitalizations below CA$274m, we found that the median total CEO compensation was CA$1.0m. From this we gather that Lyle Whitmarsh is paid around the median for CEOs in the industry. Moreover, Lyle Whitmarsh also holds CA$1.4m worth of Stampede Drilling stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	CA$391k	CA$375k	53%
Other	CA$349k	CA$1.2m	47%
Total Compensation	CA$739k	CA$1.6m	100%

Talking in terms of the industry, salary represented approximately 23% of total compensation out of all the companies we analyzed, while other remuneration made up 77% of the pie. Stampede Drilling is paying a higher share of its remuneration through a salary in comparison to the overall industry. 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.

Stampede Drilling Inc.'s Growth

Stampede Drilling Inc.'s earnings per share (EPS) grew 87% per year over the last three years. Its revenue is up 29% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Stampede Drilling Inc. Been A Good Investment?

Stampede Drilling Inc. has generated a total shareholder return of 9.5% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Stampede Drilling that you should be aware of before investing.

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

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.