Should You Worry About Ritchie Bros. Auctioneers Incorporated’s (NYSE:RBA) CEO Pay?
Ravi Saligram became the CEO of Ritchie Bros. Auctioneers Incorporated (NYSE:RBA) in 2014. First, this article will compare CEO compensation with compensation at similar sized companies. 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. This process should give us an idea about how appropriately the CEO is paid.
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How Does Ravi Saligram’s Compensation Compare With Similar Sized Companies?
Our data indicates that Ritchie Bros. Auctioneers Incorporated is worth US$3.7b, and total annual CEO compensation is US$4.1m. (This number is for the twelve months until 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$1.0m. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO compensation was US$5.1m.
That means Ravi Saligram receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at Ritchie Bros. Auctioneers, below.
Is Ritchie Bros. Auctioneers Incorporated Growing?
Ritchie Bros. Auctioneers Incorporated has reduced its earnings per share by an average of 15% a year, over the last three years. It saw its revenue drop -9.8% over the last year.
Sadly for shareholders, earnings per share are actually down, over three years. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Ritchie Bros. Auctioneers Incorporated Been A Good Investment?
Boasting a total shareholder return of 70% over three years, Ritchie Bros. Auctioneers Incorporated has done well by shareholders. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.
In Summary…
Ravi Saligram is paid around the same as most CEOs of similar size companies.
We feel that earnings per share have been a bit disappointing, but it’s nice to see positive shareholder returns over the last three years. So we think most shareholders wouldn’t be too worried about CEO compensation, which is close to the median for similar sized companies. Shareholders may want to check for free if Ritchie Bros. Auctioneers insiders are buying or selling shares.
Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
