What Does EnviroLeach Technologies' (CSE:ETI) CEO Pay Reveal?

Duane Nelson is the CEO of EnviroLeach Technologies Inc. (CSE:ETI), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also assess whether EnviroLeach Technologies pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for EnviroLeach Technologies

How Does Total Compensation For Duane Nelson Compare With Other Companies In The Industry?

At the time of writing, our data shows that EnviroLeach Technologies Inc. has a market capitalization of CA$29m, and reported total annual CEO compensation of CA$341k for the year to December 2019. That's a fairly small increase of 4.2% over the previous year. We note that the salary portion, which stands at CA$300.0k constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the industry with market capitalizations below CA$256m, we found that the median total CEO compensation was CA$152k. Hence, we can conclude that Duane Nelson is remunerated higher than the industry median. Moreover, Duane Nelson also holds CA$175k worth of EnviroLeach Technologies stock directly under their own name.

On an industry level, roughly 89% of total compensation represents salary and 11% is other remuneration. There isn't a significant difference between EnviroLeach Technologies and the broader market, in terms of salary allocation in the overall compensation package. 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.

EnviroLeach Technologies Inc.'s Growth

EnviroLeach Technologies Inc. has reduced its earnings per share by 12% a year over the last three years. Its revenue is up 124% over the last year.

The reduction in EPS, over three years, is arguably concerning. But on the other hand, revenue growth is strong, suggesting a brighter future. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has EnviroLeach Technologies Inc. Been A Good Investment?

Given the total shareholder loss of 70% over three years, many shareholders in EnviroLeach Technologies Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As previously discussed, Duane is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Meanwhile, the company has been unable to show any EPS growth, and shareholder returns are also in the red. On a more positive note, the company has produced a more positive revenue growth more recently. Few would argue that it's wise for the company to pay any more, before returns improve.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 5 warning signs (and 2 which are a bit concerning) in EnviroLeach Technologies we think you should know about.

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.

If you decide to trade EnviroLeach Technologies, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.