Yahoo Finance Is Bonavista Energy Corporation’s (TSE:BNP) CEO Paid Enough Relative To Peers?
In 2012 Jason Skehar was appointed CEO of Bonavista Energy Corporation (TSE:BNP). 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Bonavista Energy
How Does Jason Skehar’s Compensation Compare With Similar Sized Companies?
Our data indicates that Bonavista Energy Corporation is worth CA$305m, and total annual CEO compensation is CA$3.0m. (This is based on the year to December 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at CA$440k. We looked at a group of companies with market capitalizations from CA$134m to CA$535m, and the median CEO total compensation was CA$824k.
Thus we can conclude that Jason Skehar receives more in total compensation than the median of a group of companies in the same market, and of similar size to Bonavista Energy Corporation. However, this doesn’t necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Bonavista Energy has changed from year to year.
Is Bonavista Energy Corporation Growing?
Bonavista Energy Corporation has increased its earnings per share (EPS) by an average of 87% a year, over the last three years (using a line of best fit). Its revenue is down -6.0% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. The lack of revenue growth isn’t ideal, but it is the bottom line that counts most in business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Bonavista Energy Corporation Been A Good Investment?
With a three year total loss of 57%, Bonavista Energy Corporation would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary…
We examined the amount Bonavista Energy Corporation pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. Shareholders may want to check for free if Bonavista Energy insiders are buying or selling shares.
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
