Performance at Razor Energy Corp. (CVE:RZE) has been reasonably good and CEO Doug Bailey has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 22 September 2022. We present our case of why we think CEO compensation looks fair.
View our latest analysis for Razor Energy
Comparing Razor Energy Corp.'s CEO Compensation With The Industry
According to our data, Razor Energy Corp. has a market capitalization of CA$42m, and paid its CEO total annual compensation worth CA$281k over the year to December 2021. This means that the compensation hasn't changed much from last year. We note that the salary portion, which stands at CA$230.0k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below CA$264m, we found that the median total CEO compensation was CA$270k. From this we gather that Doug Bailey is paid around the median for CEOs in the industry. Furthermore, Doug Bailey directly owns CA$2.6m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2021 | 2020 | Proportion (2021) |
| Salary | CA$230k | CA$230k | 82% |
| Other | CA$51k | CA$55k | 18% |
| Total Compensation | CA$281k | CA$285k | 100% |
Talking in terms of the industry, salary represented approximately 36% of total compensation out of all the companies we analyzed, while other remuneration made up 64% of the pie. According to our research, Razor Energy has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Razor Energy Corp.'s Growth
Razor Energy Corp. has seen its earnings per share (EPS) increase by 67% a year over the past three years. In the last year, its revenue is up 81%.
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. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Razor Energy Corp. Been A Good Investment?
With a total shareholder return of 15% over three years, Razor Energy Corp. shareholders would, in general, be reasonably content. 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.