Is CSG Systems International, Inc.’s (NASDAQ:CSGS) CEO Pay Fair?

Bret Griess has been the CEO of CSG Systems International, Inc. (NASDAQ:CSGS) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for CSG Systems International

How Does Bret Griess’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that CSG Systems International, Inc. has a market cap of US$1.7b, and is paying total annual CEO compensation of US$6.5m. (This figure is for the year to December 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$700k. When we examined a selection of companies with market caps ranging from US$1.0b to US$3.2b, we found the median CEO total compensation was US$4.1m.

It would therefore appear that CSG Systems International, Inc. pays Bret Griess more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

The graphic below shows how CEO compensation at CSG Systems International has changed from year to year.

NasdaqGS:CSGS CEO Compensation, September 6th 2019
NasdaqGS:CSGS CEO Compensation, September 6th 2019

Is CSG Systems International, Inc. Growing?

On average over the last three years, CSG Systems International, Inc. has shrunk earnings per share by 2.0% each year (measured with a line of best fit). In the last year, its revenue is up 16%.

The lack of earnings per share growth in the last three years is unimpressive. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration.

Has CSG Systems International, Inc. Been A Good Investment?

CSG Systems International, Inc. has generated a total shareholder return of 31% over three years, so most shareholders would 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.

In Summary…

We compared total CEO remuneration at CSG Systems International, Inc. 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.

Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years. And shareholder returns are decent but not great. So you may want to delve deeper, because we don’t think the CEO pay is too low. Whatever your view on compensation, you might want to check if insiders are buying or selling CSG Systems International 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.

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.

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. Thank you for reading.