Yahoo Finance Is Golden Valley Mines Ltd.'s (CVE:GZZ) CEO Pay Fair?
Glenn Mullan became the CEO of Golden Valley Mines Ltd. (CVE:GZZ) in 2000. First, this article will compare CEO compensation with compensation at similar sized companies. 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 Golden Valley Mines
How Does Glenn Mullan's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Golden Valley Mines Ltd. has a market cap of CA$51m, and is paying total annual CEO compensation of CA$537k. (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 CA$225k. We examined a group of similar sized companies, with market capitalizations of below CA$265m. The median CEO total compensation in that group is CA$130k.
As you can see, Glenn Mullan is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Golden Valley Mines Ltd. is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Golden Valley Mines has changed from year to year.
Is Golden Valley Mines Ltd. Growing?
Over the last three years Golden Valley Mines Ltd. has shrunk its earnings per share by an average of 59% per year (measured with a line of best fit). In the last year, its revenue is up 1930%.
The reduction in earnings per share, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Golden Valley Mines Ltd. Been A Good Investment?
With a total shareholder return of 27% over three years, Golden Valley Mines Ltd. 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.
In Summary...
We compared total CEO remuneration at Golden Valley Mines Ltd. with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. So it's certainly hard to argue that the CEO is modestly paid, although we don't see the remuneration as an issue. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Golden Valley Mines.
Important note: Golden Valley Mines may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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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.
