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Is Aequus Pharmaceuticals Inc’s (CVE:AQS) CEO Being Overpaid?

Doug Janzen has been the CEO of Aequus Pharmaceuticals Inc (CVE:AQS) since 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Aequus Pharmaceuticals

How Does Doug Janzen’s Compensation Compare With Similar Sized Companies?

According to our data, Aequus Pharmaceuticals Inc has a market capitalization of CA$14m, and pays its CEO total annual compensation worth CA$258k. (This figure is for the year to 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at CA$210k. We examined a group of similar sized companies, with market capitalizations of below CA$265m. The median CEO compensation in that group is CA$154k.

It would therefore appear that Aequus Pharmaceuticals Inc pays Doug Janzen more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see, below, how CEO compensation at Aequus Pharmaceuticals has changed over time.

TSXV:AQS CEO Compensation November 27th 18

Is Aequus Pharmaceuticals Inc Growing?

Over the last three years Aequus Pharmaceuticals Inc has grown its earnings per share (EPS) by an average of 38% per year. It achieved revenue growth of 49% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business.

Although we don’t have analyst forecasts, you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Aequus Pharmaceuticals Inc Been A Good Investment?

Given the total loss of 74% over three years, many shareholders in Aequus Pharmaceuticals Inc are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

We examined the amount Aequus Pharmaceuticals Inc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. While EPS is positive, we’d say shareholders would want better returns before the CEO is paid much more. Shareholders may want to check for free if Aequus Pharmaceuticals insiders are buying or selling shares.

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 editorial-team@simplywallst.com.