Yahoo Finance Should You Worry About Spirax-Sarco Engineering plc’s (LON:SPX) CEO Pay?
Nick Anderson became the CEO of Spirax-Sarco Engineering plc (LON:SPX) in 2014. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. 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 Spirax-Sarco Engineering
Want to help shape the future of investing tools and platforms? Take the survey and be part of one of the most advanced studies of stock market investors to date.
How Does Nick Anderson’s Compensation Compare With Similar Sized Companies?
According to our data, Spirax-Sarco Engineering plc has a market capitalization of UK£4.8b, and pays its CEO total annual compensation worth UK£2.2m. (This number is for the twelve months until 2017). We think total compensation is more important but we note that the CEO salary is lower, at UK£528k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£3.1b to UK£9.3b. The median total CEO compensation was UK£2.6m.
So Nick Anderson is paid around the average of the companies we looked at. 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 Spirax-Sarco Engineering has changed from year to year.
Is Spirax-Sarco Engineering plc Growing?
Over the last three years Spirax-Sarco Engineering plc has grown its earnings per share (EPS) by an average of 22% per year (using a line of best fit). Its revenue is up 33% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Spirax-Sarco Engineering plc Been A Good Investment?
I think that the total shareholder return of 128%, over three years, would leave most Spirax-Sarco Engineering plc shareholders smiling. 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…
Nick Anderson is paid around what is normal the leaders of comparable size companies.
Shareholders would surely be happy to see that shareholder returns have been great, and the earnings per share are up. Indeed, many might consider the pay rather modest, given the solid company performance! Whatever your view on compensation, you might want to check if insiders are buying or selling Spirax-Sarco Engineering shares (free trial).
Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
