Is Fevertree Drinks Plc's (LON:FEVR) CEO Pay Fair?
The CEO of Fevertree Drinks Plc (LON:FEVR) is Tim Warrillow. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Fevertree Drinks
How Does Tim Warrillow's Compensation Compare With Similar Sized Companies?
According to our data, Fevertree Drinks Plc has a market capitalization of UK£1.7b, and paid its CEO total annual compensation worth UK£4.0m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at UK£368k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations from UK£772m to UK£2.5b, and the median CEO total compensation was UK£1.4m.
As you can see, Tim Warrillow is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Fevertree Drinks Plc is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Fevertree Drinks, below.
Is Fevertree Drinks Plc Growing?
Over the last three years Fevertree Drinks Plc has grown its earnings per share (EPS) by an average of 36% per year (using a line of best fit). It achieved revenue growth of 24% over the last year.
This demonstrates that the company has been improving recently. A good result. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Fevertree Drinks Plc Been A Good Investment?
Fevertree Drinks Plc has generated a total shareholder return of 8.0% over three years, so most shareholders wouldn't be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
We compared total CEO remuneration at Fevertree Drinks Plc with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
However, the earnings per share growth over three years is certainly impressive. We also note that, over the same time frame, shareholder returns haven't been bad. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn't call the CEO pay problematic. Shareholders may want to check for free if Fevertree Drinks insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
