Here's What We Think About PipeHawk's (LON:PIP) CEO Pay

Gordon Watt is the CEO of PipeHawk plc (LON:PIP), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for PipeHawk.

View our latest analysis for PipeHawk

How Does Total Compensation For Gordon Watt Compare With Other Companies In The Industry?

According to our data, PipeHawk plc has a market capitalization of UK£2.5m, and paid its CEO total annual compensation worth UK£71k over the year to June 2020. This means that the compensation hasn't changed much from last year. It is worth noting that the CEO compensation consists entirely of the salary, worth UK£71k.

For comparison, other companies in the industry with market capitalizations below UK£150m, reported a median total CEO compensation of UK£227k. This suggests that Gordon Watt is paid below the industry median. Moreover, Gordon Watt also holds UK£415k worth of PipeHawk 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 70% of total compensation out of all the companies we analyzed, while other remuneration made up 30% of the pie. At the company level, PipeHawk pays Gordon Watt solely through a salary, preferring to go down a conventional route. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

PipeHawk plc's Growth

PipeHawk plc's earnings per share (EPS) grew 46% per year over the last three years. Its revenue is up 24% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and 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 PipeHawk plc Been A Good Investment?

Boasting a total shareholder return of 107% over three years, PipeHawk plc has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

PipeHawk pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. As we touched on above, PipeHawk plc is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Considering robust EPS growth, we believe Gordon to be modestly paid. And given most shareholders are probably very happy with recent shareholder returns, they might even think Gordon deserves a raise!

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. In our study, we found 4 warning signs for PipeHawk you should be aware of, and 3 of them are potentially serious.

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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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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