What We Learned About Windfall Geotek's (CVE:WIN) CEO Compensation

This article will reflect on the compensation paid to Michel Fontaine who has served as CEO of Windfall Geotek Inc. (CVE:WIN) since 2017. This analysis will also assess whether Windfall Geotek pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Windfall Geotek

How Does Total Compensation For Michel Fontaine Compare With Other Companies In The Industry?

Our data indicates that Windfall Geotek Inc. has a market capitalization of CA$19m, and total annual CEO compensation was reported as CA$120k for the year to February 2020. We note that's a decrease of 12% compared to last year. It is worth noting that the CEO compensation consists entirely of the salary, worth CA$120k.

On comparing similar-sized companies in the industry with market capitalizations below CA$257m, we found that the median total CEO compensation was CA$227k. This suggests that Michel Fontaine is paid below the industry median. Moreover, Michel Fontaine also holds CA$598k worth of Windfall Geotek 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 77% of total compensation out of all the companies we analyzed, while other remuneration made up 23% of the pie. On a company level, Windfall Geotek prefers to reward its CEO through a salary, opting not to pay Michel Fontaine through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Windfall Geotek Inc.'s Growth

Windfall Geotek Inc.'s earnings per share (EPS) grew 51% per year over the last three years. Its revenue is up 97% 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. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Windfall Geotek Inc. Been A Good Investment?

Boasting a total shareholder return of 144% over three years, Windfall Geotek Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Windfall Geotek rewards its CEO solely through a salary, ignoring non-salary benefits completely. As previously discussed, Michel is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. When taking into account the company's strong EPS growth over the past three years, it appears CEO compensation is modest. Plus, we can't ignore the impressive shareholder returns, and won't be surprised if some shareholders were to reward such excellent all-around performance with 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 5 warning signs for Windfall Geotek (2 don't sit too well with us!) that you should be aware of before investing here.

Important note: Windfall Geotek 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. 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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