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How Does Evertz Technologies' (TSE:ET) CEO Pay Compare With Company Performance?
The CEO of Evertz Technologies Limited (TSE:ET) is Romolo Magarelli, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Evertz Technologies.
Check out our latest analysis for Evertz Technologies
Comparing Evertz Technologies Limited's CEO Compensation With the industry
According to our data, Evertz Technologies Limited has a market capitalization of CA$1.0b, and paid its CEO total annual compensation worth CA$1.1m over the year to April 2020. We note that's a decrease of 13% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CA$408k.
In comparison with other companies in the industry with market capitalizations ranging from CA$509m to CA$2.0b, the reported median CEO total compensation was CA$2.2m. That is to say, Romolo Magarelli is paid under the industry median. Moreover, Romolo Magarelli also holds CA$327m worth of Evertz Technologies stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | CA$408k | CA$400k | 36% |
| Other | CA$720k | CA$900k | 64% |
| Total Compensation | CA$1.1m | CA$1.3m | 100% |
Talking in terms of the industry, salary represented approximately 58% of total compensation out of all the companies we analyzed, while other remuneration made up 42% of the pie. Evertz Technologies pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Evertz Technologies Limited's Growth Numbers
Evertz Technologies Limited has reduced its earnings per share by 2.5% a year over the last three years. In the last year, its revenue is down 18%.
Its a bit disappointing to see that the company has failed to grow its EPS. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Evertz Technologies Limited Been A Good Investment?
Given the total shareholder loss of 5.1% over three years, many shareholders in Evertz Technologies Limited are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
As previously discussed, Romolo is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. While we are quite underwhelmed with EPS growth, the shareholder returns over the past three years have also failed to impress us. We can't say the CEO compensation is high, but shareholders will be cold to a bump at this stage, considering negative investor returns.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Evertz Technologies that investors should think about before committing capital to this stock.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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Valuation is complex, but we're here to simplify it.
Discover if Evertz Technologies might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
Access Free AnalysisThis 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 (at) simplywallst.com.
About TSX:ET
Evertz Technologies
Engages in the design, manufacture, and distribution of video and audio infrastructure solutions for the production, post-production, broadcast, and telecommunications markets in Canada, the United States, and internationally.
Flawless balance sheet with solid track record.
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