Under the guidance of CEO Jason Beddow, Argo Investments Limited (ASX:ARG) has performed reasonably well recently. As shareholders go into the upcoming AGM on 23 October 2022, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. We present our case of why we think CEO compensation looks fair.

See our latest analysis for Argo Investments

How Does Total Compensation For Jason Beddow Compare With Other Companies In The Industry?

According to our data, Argo Investments Limited has a market capitalization of AU$6.6b, and paid its CEO total annual compensation worth AU$1.2m over the year to June 2022. We note that's an increase of 17% above last year. Notably, the salary which is AU$766.8k, represents most of the total compensation being paid.

On examining similar-sized companies in the industry with market capitalizations between AU$3.2b and AU$10b, we discovered that the median CEO total compensation of that group was AU$1.6m. This suggests that Argo Investments remunerates its CEO largely in line with the industry average. What's more, Jason Beddow holds AU$3.4m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 56% of total compensation represents salary and 44% is other remuneration. It's interesting to note that Argo Investments pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Argo Investments Limited's Growth Numbers

Over the last three years, Argo Investments Limited has not seen its earnings per share change much, though there is a slight positive movement. In the last year, its revenue is up 66%.

It's great to see that revenue growth is strong. Combined with modest EPS growth, we get a good impression of the company. We wouldn't say this is necessarily top notch growth, but it is certainly promising. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Argo Investments Limited Been A Good Investment?

With a total shareholder return of 16% over three years, Argo Investments Limited shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 3 warning signs (and 1 which doesn't sit too well with us) in Argo Investments we think you should know about.

Important note: Argo Investments is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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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