This article will reflect on the compensation paid to Nick Jefferies who has served as CEO of discoverIE Group plc (LON:DSCV) since 2009. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for discoverIE Group.
How Does Total Compensation For Nick Jefferies Compare With Other Companies In The Industry?
At the time of writing, our data shows that discoverIE Group plc has a market capitalization of UK£560m, and reported total annual CEO compensation of UK£2.1m for the year to March 2020. Notably, that's an increase of 17% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at UK£467k.
On comparing similar companies from the same industry with market caps ranging from UK£314m to UK£1.3b, we found that the median CEO total compensation was UK£790k. Hence, we can conclude that Nick Jefferies is remunerated higher than the industry median. Moreover, Nick Jefferies also holds UK£6.0m worth of discoverIE Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Speaking on an industry level, nearly 79% of total compensation represents salary, while the remainder of 21% is other remuneration. discoverIE Group pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
discoverIE Group plc's Growth
discoverIE Group plc's earnings per share (EPS) grew 47% per year over the last three years. It achieved revenue growth of 6.2% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has discoverIE Group plc Been A Good Investment?
Most shareholders would probably be pleased with discoverIE Group plc for providing a total return of 112% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
As we touched on above, discoverIE Group plc is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Importantly though, EPS growth and shareholder returns are very impressive over the last three years. So, in acknowledgment of the overall excellent performance, we believe CEO compensation is appropriate. Given the strong history of shareholder returns, the shareholders are probably very happy with Nick's performance.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 2 warning signs for discoverIE Group that investors should be aware of in a dynamic business environment.
Switching gears from discoverIE Group, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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