Increases to Sunrise Energy Metals Limited's (ASX:SRL) CEO Compensation Might Cool off for now

·3 min read

Shareholders of Sunrise Energy Metals Limited (ASX:SRL) will have been dismayed by the negative share price return over the last three years. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. Shareholders will have a chance to take their concerns to the board at the next AGM on 22 October 2021 and vote on resolutions including executive compensation, which studies show may have an impact on company performance. We think shareholders may be cautious of approving a pay rise for the CEO at the moment, based on our analysis below.

View our latest analysis for Sunrise Energy Metals

Comparing Sunrise Energy Metals Limited's CEO Compensation With the industry

Our data indicates that Sunrise Energy Metals Limited has a market capitalization of AU$162m, and total annual CEO compensation was reported as AU$903k for the year to June 2021. That's a notable increase of 18% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at AU$381k.

In comparison with other companies in the industry with market capitalizations under AU$270m, the reported median total CEO compensation was AU$356k. Hence, we can conclude that Sam Riggall is remunerated higher than the industry median. What's more, Sam Riggall holds AU$4.8m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2021

2020

Proportion (2021)

Salary

AU$381k

AU$476k

42%

Other

AU$522k

AU$287k

58%

Total Compensation

AU$903k

AU$763k

100%

Speaking on an industry level, nearly 63% of total compensation represents salary, while the remainder of 37% is other remuneration. Sunrise Energy Metals sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
ceo-compensation

Sunrise Energy Metals Limited's Growth

Over the last three years, Sunrise Energy Metals Limited has shrunk its earnings per share by 63% per year. In the last year, its revenue is up 1,893%.

Investors would be a bit wary of companies that have lower EPS But on the other hand, revenue growth is strong, suggesting a brighter future. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Sunrise Energy Metals Limited Been A Good Investment?

With a total shareholder return of -60% over three years, Sunrise Energy Metals Limited shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The company's earnings haven't grown and possibly because of that, the stock has performed poorly, resulting in a loss for the company's shareholders. Shareholders will get the chance at the upcoming AGM to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 3 warning signs (and 1 which shouldn't be ignored) in Sunrise Energy Metals we think you should know about.

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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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