In 2015 Greg Guidry was appointed CEO of Gran Tierra Energy Inc. (NYSEMKT:GTE). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
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How Does Greg Guidry’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Gran Tierra Energy Inc. has a market cap of US$925m, and is paying total annual CEO compensation of US$1.8m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$319k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$400m to US$1.6b. The median total CEO compensation was US$2.3m.
So Greg Guidry receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at Gran Tierra Energy, below.
Is Gran Tierra Energy Inc. Growing?
On average over the last three years, Gran Tierra Energy Inc. has grown earnings per share (EPS) by 69% each year (using a line of best fit). It achieved revenue growth of 56% over the last year.
This demonstrates that the company has been improving recently. A good result. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see.
You might want to check this free visual report on analyst forecasts for future earnings.
Has Gran Tierra Energy Inc. Been A Good Investment?
Gran Tierra Energy Inc. has served shareholders reasonably well, with a total return of 25% over three years. 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.
Greg Guidry is paid around what is normal the leaders of comparable size companies.
We would wish for better returns (whether dividends or capital gains) but we do admire the solid EPS growth on show here. So considering these factors, we think the CEO pay is probably quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling Gran Tierra Energy shares (free trial).
Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.