Yahoo Finance Does AgJunction Inc.'s (TSE:AJX) CEO Pay Matter?
Dave Vaughn became the CEO of AgJunction Inc. (TSE:AJX) in 2015. 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 - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
View our latest analysis for AgJunction
How Does Dave Vaughn's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that AgJunction Inc. has a market cap of CA$56m, and is paying total annual CEO compensation of US$450k. (This figure is for the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$300k. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO total compensation to be US$104k.
Thus we can conclude that Dave Vaughn receives more in total compensation than the median of a group of companies in the same market, and of similar size to AgJunction Inc.. 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 AgJunction has changed from year to year.
Is AgJunction Inc. Growing?
Over the last three years AgJunction Inc. has grown its earnings per share (EPS) by an average of 83% per year (using a line of best fit). It achieved revenue growth of 29% 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, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has AgJunction Inc. Been A Good Investment?
With a three year total loss of 29%, AgJunction Inc. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
We examined the amount AgJunction 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.
However, the earnings per share growth over three years is certainly impressive. However, the returns to investors are far less impressive, over the same period. Considering the per share profit growth, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at AgJunction.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
