Yahoo Finance Why NuVista Energy Ltd.'s (TSE:NVA) CEO Pay Matters To You
Jonathan Wright has been the CEO of NuVista Energy Ltd. (TSE:NVA) since 2011. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. 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 NuVista Energy
How Does Jonathan Wright's Compensation Compare With Similar Sized Companies?
According to our data, NuVista Energy Ltd. has a market capitalization of CA$530m, and paid its CEO total annual compensation worth CA$2.3m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at CA$455k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of CA$265m to CA$1.1b. The median total CEO compensation was CA$1.4m.
As you can see, Jonathan Wright is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean NuVista Energy 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 NuVista Energy has changed from year to year.
Is NuVista Energy Ltd. Growing?
Over the last three years NuVista Energy Ltd. has grown its earnings per share (EPS) by an average of 80% per year (using a line of best fit). Its revenue is up 18% over last year.
This demonstrates that the company has been improving recently. A good result. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Shareholders might be interested in this free visualization of analyst forecasts.
Has NuVista Energy Ltd. Been A Good Investment?
Since shareholders would have lost about 65% over three years, some NuVista Energy Ltd. shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
We examined the amount NuVista Energy Ltd. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. Shareholders may want to check for free if NuVista Energy insiders are buying or selling shares.
If you want to buy a stock that is better than NuVista Energy, this free list of high return, low debt companies is a great place to look.
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.
