What Does Armada Data's (CVE:ARD) CEO Pay Reveal?

R. Matthews has been the CEO of Armada Data Corporation (CVE:ARD) since 2000, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Armada Data pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Armada Data

Comparing Armada Data Corporation's CEO Compensation With the industry

Our data indicates that Armada Data Corporation has a market capitalization of CA$3.4m, and total annual CEO compensation was reported as CA$109k for the year to May 2020. That's mostly flat as compared to the prior year's compensation. We note that the salary portion, which stands at CA$102.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under CA$254m, the reported median total CEO compensation was CA$276k. This suggests that R. Matthews is paid below the industry median. Moreover, R. Matthews also holds CA$693k worth of Armada Data stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 76% of total compensation out of all the companies we analyzed, while other remuneration made up 24% of the pie. Armada Data is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Armada Data Corporation's Growth

Armada Data Corporation has reduced its earnings per share by 11% a year over the last three years. Its revenue is up 20% 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. It's hard to reach a conclusion about business performance right now. This may be one to watch. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Armada Data Corporation Been A Good Investment?

With a total shareholder return of 15% over three years, Armada Data Corporation shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

As we noted earlier, Armada Data pays its CEO lower than the norm for similar-sized companies belonging to the same industry. And revenue growth for the company is showing some positive trends.And revenues are growing at a healthy clip.And revenues are increasing at a good pace over the past year. But EPS growth has been negative, and shareholder returns, though growing, have not been very impressive over this time. So even though we don't think compensation is too high, shareholders will likely want to see healthier returns, before they agree R. deserves a raise.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 3 warning signs for Armada Data (1 is significant!) that you should be aware of before investing here.

Switching gears from Armada Data, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.
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