Stephen Sadler became the CEO of Enghouse Systems Limited (TSE:ENGH) in 2000. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Stephen Sadler’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Enghouse Systems Limited has a market cap of CA$2.0b, and is paying total annual CEO compensation of CA$5m. We note that’s an increase of 21% above last year. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of CA$1.3b to CA$4.2b. The median total CEO compensation was CA$3m.
It would therefore appear that Enghouse Systems Limited pays Stephen Sadler 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 get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Enghouse Systems has changed from year to year.
Is Enghouse Systems Limited Growing?
Enghouse Systems Limited has increased its earnings per share (EPS) by an average of 18% a year, over the last three years It achieved revenue growth of 6.7% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Enghouse Systems Limited Been A Good Investment?
With a total shareholder return of 23% over three years, Enghouse Systems Limited shareholders would, in general, 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.
We compared the total CEO remuneration paid by Enghouse Systems Limited, and compared it to remuneration at a group of 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. We also note that, over the same time frame, shareholder returns haven’t been bad. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn’t call the CEO pay problematic. Shareholders may want to check for free if Enghouse Systems Limited insiders are buying or selling shares.
Or you might prefer this data-rich interactive visualization of historic revenue and earnings.
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.