Why Dawson Geophysical Company's (NASDAQ:DWSN) CEO Pay Matters To You

In 2015 Stephen Jumper was appointed CEO of Dawson Geophysical Company (NASDAQ:DWSN). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Dawson Geophysical

How Does Stephen Jumper's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Dawson Geophysical Company has a market cap of US$65m, and reported total annual CEO compensation of US$876k for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$577k. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO total compensation to be US$515k.

As you can see, Stephen Jumper is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Dawson Geophysical Company is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.

The graphic below shows how CEO compensation at Dawson Geophysical has changed from year to year.

Is Dawson Geophysical Company Growing?

Dawson Geophysical Company has increased its earnings per share (EPS) by an average of 25% a year, over the last three years (using a line of best fit). In the last year, its revenue is down 15%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Although we don't have analyst forecasts you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Dawson Geophysical Company Been A Good Investment?

Given the total loss of 64% over three years, many shareholders in Dawson Geophysical Company are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

We examined the amount Dawson Geophysical Company pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. However, the returns to investors are far less impressive, over the same period. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. Shareholders may want to check for free if Dawson Geophysical insiders are buying or selling shares.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

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.

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. Thank you for reading.