Does KalVista Pharmaceuticals, Inc.’s (NASDAQ:KALV) CEO Pay Matter?

Andy Crockett has been the CEO of KalVista Pharmaceuticals, Inc. (NASDAQ:KALV) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for KalVista Pharmaceuticals

How Does Andy Crockett’s Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that KalVista Pharmaceuticals, Inc. has a market cap of US$237m, and reported total annual CEO compensation of US$3.3m for the year to April 2019. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$505k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. When we examined a selection of companies with market caps ranging from US$100m to US$400m, we found the median CEO total compensation was US$1.1m.

Thus we can conclude that Andy Crockett receives more in total compensation than the median of a group of companies in the same market, and of similar size to KalVista Pharmaceuticals, Inc.. However, this doesn’t necessarily mean the pay is too high. 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 KalVista Pharmaceuticals, below.

NasdaqGM:KALV CEO Compensation, February 25th 2020
NasdaqGM:KALV CEO Compensation, February 25th 2020

Is KalVista Pharmaceuticals, Inc. Growing?

On average over the last three years, KalVista Pharmaceuticals, Inc. has grown earnings per share (EPS) by 73% each year (using a line of best fit). Its revenue is down 14% over last year.

This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. It could be important to check this free visual depiction of what analysts expect for the future.

Has KalVista Pharmaceuticals, Inc. Been A Good Investment?

Most shareholders would probably be pleased with KalVista Pharmaceuticals, Inc. for providing a total return of 81% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary…

We compared the total CEO remuneration paid by KalVista Pharmaceuticals, Inc., and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. In addition, shareholders have done well over the same time period. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. Whatever your view on compensation, you might want to check if insiders are buying or selling KalVista Pharmaceuticals shares (free trial).

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.