Here's Why Acadian Timber Corp.'s (TSE:ADN) CEO Compensation Is The Least Of Shareholders' Concerns

Key Insights

• Acadian Timber's Annual General Meeting to take place on 8th of May
• CEO Adam Sheparski's total compensation includes salary of CA$353.0k
• The overall pay is comparable to the industry average
• Acadian Timber's EPS grew by 2.9% over the past three years while total shareholder return over the past three years was 14%

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Under the guidance of CEO Adam Sheparski, Acadian Timber Corp. (TSE:ADN) has performed reasonably well recently. As shareholders go into the upcoming AGM on 8th of May, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. Here is our take on why we think the CEO compensation looks appropriate.

See our latest analysis for Acadian Timber

Comparing Acadian Timber Corp.'s CEO Compensation With The Industry

At the time of writing, our data shows that Acadian Timber Corp. has a market capitalization of CA$308m, and reported total annual CEO compensation of CA$592k for the year to December 2024. That's a modest increase of 4.0% on the prior year. In particular, the salary of CA$353.0k, makes up a fairly large portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the Canadian Forestry industry with market capitalizations between CA$138m and CA$554m, we discovered that the median CEO total compensation of that group was CA$578k. So it looks like Acadian Timber compensates Adam Sheparski in line with the median for the industry. Furthermore, Adam Sheparski directly owns CA$276k worth of shares in the company.

Talking in terms of the industry, salary represented approximately 37% of total compensation out of all the companies we analyzed, while other remuneration made up 63% of the pie. According to our research, Acadian Timber has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Acadian Timber Corp.'s Growth Numbers

Acadian Timber Corp. has seen its earnings per share (EPS) increase by 2.9% a year over the past three years. It achieved revenue growth of 24% over the last year.

This revenue growth could really point to a brighter future. And, while modest, the EPS growth is noticeable. Although we'll stop short of calling the stock a top performer, we think the company has potential. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Acadian Timber Corp. Been A Good Investment?

With a total shareholder return of 14% over three years, Acadian Timber Corp. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

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. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 3 warning signs (and 1 which is concerning) in Acadian Timber we think you should know about.

Important note: Acadian Timber is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.