Yahoo Finance Is Granite Oil Corp.'s (TSE:GXO) CEO Overpaid Relative To Its Peers?
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Mike Kabanuk became the CEO of Granite Oil Corp. (TSE:GXO) in 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Granite Oil
How Does Mike Kabanuk's Compensation Compare With Similar Sized Companies?
Our data indicates that Granite Oil Corp. is worth CA$25m, and total annual CEO compensation is CA$225k. (This number is for the twelve months until December 2018). That's actually a decrease on the year before. It is worth noting that the CEO compensation consists almost entirely of the salary, worth CA$220k. We looked at a group of companies with market capitalizations under CA$270m, and the median CEO total compensation was CA$150k.
As you can see, Mike Kabanuk is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Granite Oil Corp. 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.
You can see, below, how CEO compensation at Granite Oil has changed over time.
Is Granite Oil Corp. Growing?
Granite Oil Corp. has reduced its earnings per share by an average of 124% a year, over the last three years (measured with a line of best fit). Its revenue is down -13% over last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. And the fact that revenue is down year on year arguably paints an ugly picture. 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 Granite Oil Corp. Been A Good Investment?
Given the total loss of 89% over three years, many shareholders in Granite Oil Corp. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
We compared the total CEO remuneration paid by Granite Oil Corp., and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
Arguably worse, investors are without a positive return for the last three years. Some might well form the view that the CEO is paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling Granite Oil shares (free trial).
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.
