How Does Alpha Financial Markets Consulting's (LON:AFM) CEO Pay Compare With Company Performance?

Euan N. Fraser became the CEO of Alpha Financial Markets Consulting plc (LON:AFM) in 2013, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Alpha Financial Markets Consulting pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Alpha Financial Markets Consulting

Comparing Alpha Financial Markets Consulting plc's CEO Compensation With the industry

Our data indicates that Alpha Financial Markets Consulting plc has a market capitalization of UK£238m, and total annual CEO compensation was reported as UK£583k for the year to March 2020. Notably, that's an increase of 9.0% over the year before. Notably, the salary which is UK£566.0k, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations ranging from UK£150m to UK£600m, the reported median CEO total compensation was UK£322k. Hence, we can conclude that Euan N. Fraser is remunerated higher than the industry median. Furthermore, Euan N. Fraser directly owns UK£3.7m worth of shares in the company, implying that they are deeply invested in the company's success.

Speaking on an industry level, nearly 77% of total compensation represents salary, while the remainder of 23% is other remuneration. Alpha Financial Markets Consulting is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Alpha Financial Markets Consulting plc's Growth

Alpha Financial Markets Consulting plc's earnings per share (EPS) grew 42% per year over the last three years. It achieved revenue growth of 18% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Alpha Financial Markets Consulting plc Been A Good Investment?

Boasting a total shareholder return of 46% over three years, Alpha Financial Markets Consulting plc 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.

In Summary...

Euan N. receives almost all of their compensation through a salary. As previously discussed, Euan N. is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. But EPS growth and shareholder returns have been top-notch for the past three years. As a result of the excellent all-round performance of the company, we believe CEO compensation is fair. Given the strong history of shareholder returns, the shareholders are probably very happy with Euan N.'s performance.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 4 warning signs for Alpha Financial Markets Consulting that investors should look into moving forward.

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.

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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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