What Can We Learn About Tinybeans Group's (ASX:TNY) CEO Compensation?

Simply Wall St
·4-min read

The CEO of Tinybeans Group Limited (ASX:TNY) is Eddie Geller, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Tinybeans Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Tinybeans Group

Comparing Tinybeans Group Limited's CEO Compensation With the industry

According to our data, Tinybeans Group Limited has a market capitalization of AU$54m, and paid its CEO total annual compensation worth AU$527k over the year to June 2020. That's a modest increase of 7.8% on the prior year. In particular, the salary of AU$386.8k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below AU$285m, we found that the median total CEO compensation was AU$314k. Accordingly, our analysis reveals that Tinybeans Group Limited pays Eddie Geller north of the industry median. Moreover, Eddie Geller also holds AU$6.6m worth of Tinybeans Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component

2020

2019

Proportion (2020)

Salary

AU$387k

AU$364k

73%

Other

AU$140k

AU$125k

27%

Total Compensation

AU$527k

AU$489k

100%

On an industry level, roughly 73% of total compensation represents salary and 27% is other remuneration. Tinybeans Group is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

ceo-compensation
ceo-compensation

A Look at Tinybeans Group Limited's Growth Numbers

Tinybeans Group Limited has seen its earnings per share (EPS) increase by 15% a year over the past three years. Its revenue is up 54% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Tinybeans Group Limited Been A Good Investment?

Tinybeans Group Limited has served shareholders reasonably well, with a total return of 22% over three years. 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...

As we touched on above, Tinybeans Group Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But the company has impressed us with its EPS growth, over three years. We also think investor returns are steady over the same time period. So, considering the EPS growth we do not wish to criticize CEO compensation, though we'd recommend further research on management.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 5 warning signs for Tinybeans Group you should be aware of, and 1 of them doesn't sit too well with us.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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