Why We Think Skyline Investments Inc.'s (TLV:SKLN) CEO Compensation Is Not Excessive At All

Under the guidance of CEO Blake Lyon, Skyline Investments Inc. (TLV:SKLN) has performed reasonably well recently. As shareholders go into the upcoming AGM on 20 December 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. We present our case of why we think CEO compensation looks fair.

See our latest analysis for Skyline Investments

How Does Total Compensation For Blake Lyon Compare With Other Companies In The Industry?

At the time of writing, our data shows that Skyline Investments Inc. has a market capitalization of ₪462m, and reported total annual CEO compensation of CA$531k for the year to December 2020. That's a notable decrease of 36% on last year. Notably, the salary which is CA$415.0k, represents most of the total compensation being paid.

On comparing similar-sized companies in the industry with market capitalizations below ₪622m, we found that the median total CEO compensation was CA$577k. This suggests that Skyline Investments remunerates its CEO largely in line with the industry average.

Component	2020	2019	Proportion (2020)
Salary	CA$415k	CA$408k	78%
Other	CA$116k	CA$427k	22%
Total Compensation	CA$531k	CA$835k	100%

On an industry level, around 61% of total compensation represents salary and 39% is other remuneration. Skyline Investments is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Skyline Investments Inc.'s Growth

Over the past three years, Skyline Investments Inc. has seen its earnings per share (EPS) grow by 81% per year. It saw its revenue drop 18% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Skyline Investments Inc. Been A Good Investment?

Skyline Investments Inc. has generated a total shareholder return of 15% over three years, so most shareholders would 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.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

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. We did our research and identified 3 warning signs (and 1 which is significant) in Skyline Investments we think you should know about.

Important note: Skyline Investments 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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.