Yahoo Finance Is Return Energy Inc.'s (CVE:RTN) CEO Being Overpaid?
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Ken Tompson has been the CEO of Return Energy Inc. (CVE:RTN) since 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 Return Energy
How Does Ken Tompson's Compensation Compare With Similar Sized Companies?
According to our data, Return Energy Inc. has a market capitalization of CA$2.8m, and pays its CEO total annual compensation worth CA$166k. (This is based on the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at CA$122k. We took a group of companies with market capitalizations below CA$268m, and calculated the median CEO total compensation to be CA$140k.
That means Ken Tompson receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at Return Energy has changed from year to year.
Is Return Energy Inc. Growing?
Over the last three years Return Energy Inc. has grown its earnings per share (EPS) by an average of 76% per year (using a line of best fit). Revenue was pretty flat on last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Return Energy Inc. Been A Good Investment?
Since shareholders would have lost about 50% over three years, some Return Energy Inc. shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
Remuneration for Ken Tompson is close enough to the median pay for a CEO of a similar sized company .
We'd say the company can boast of its EPS growth, but we find the returns over the last three years to be lacking. We'd be surprised if shareholders want to see a pay rise for the CEO, but we'd stop short of calling their pay too generous. Whatever your view on compensation, you might want to check if insiders are buying or selling Return Energy shares (free trial).
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.
