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Is GDI Integrated Facility Services Inc. (TSE:GDI) Overpaying Its CEO?

Simply Wall St

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Claude Bigras has been the CEO of GDI Integrated Facility Services Inc. (TSE:GDI) since 2004. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. 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.

Check out our latest analysis for GDI Integrated Facility Services

How Does Claude Bigras's Compensation Compare With Similar Sized Companies?

Our data indicates that GDI Integrated Facility Services Inc. is worth CA$594m, and total annual CEO compensation is CA$2.2m. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at CA$566k. We examined companies with market caps from CA$262m to CA$1.0b, and discovered that the median CEO total compensation of that group was CA$1.4m.

Thus we can conclude that Claude Bigras receives more in total compensation than the median of a group of companies in the same market, and of similar size to GDI Integrated Facility Services Inc.. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at GDI Integrated Facility Services has changed over time.

TSX:GDI CEO Compensation, July 11th 2019

Is GDI Integrated Facility Services Inc. Growing?

GDI Integrated Facility Services Inc. has reduced its earnings per share by an average of 9.9% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 18%.

Sadly for shareholders, earnings per share are actually down, over three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.

Has GDI Integrated Facility Services Inc. Been A Good Investment?

Boasting a total shareholder return of 116% over three years, GDI Integrated Facility Services Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

We examined the amount GDI Integrated Facility Services Inc. 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.

We think many shareholders would be underwhelmed with the business growth over the last three years.

However, we can't argue with the strong returns to shareholders, over the same time period. Considering this, shareholders are probably not too worried about the CEO compensation. So you may want to check if insiders are buying GDI Integrated Facility Services shares with their own money (free access).

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.