Is Palatin Technologies, Inc. (NYSEMKT:PTN) Excessively Paying Its CEO?

In 2000 Carl Spana was appointed CEO of Palatin Technologies, Inc. (NYSEMKT:PTN). 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. 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.

View our latest analysis for Palatin Technologies

How Does Carl Spana’s Compensation Compare With Similar Sized Companies?

Our data indicates that Palatin Technologies, Inc. is worth US$133m, and total annual CEO compensation was reported as US$2.3m for the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at US$505k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$522k.

It would therefore appear that Palatin Technologies, Inc. pays Carl Spana 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 get a better idea of how generous the pay is by looking at the performance of the underlying business.

The graphic below shows how CEO compensation at Palatin Technologies has changed from year to year.

AMEX:PTN CEO Compensation, February 17th 2020
AMEX:PTN CEO Compensation, February 17th 2020

Is Palatin Technologies, Inc. Growing?

Palatin Technologies, Inc. has increased its earnings per share (EPS) by an average of 97% a year, over the last three years (using a line of best fit). Its revenue is up 104% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. Shareholders might be interested in this free visualization of analyst forecasts.

Has Palatin Technologies, Inc. Been A Good Investment?

Most shareholders would probably be pleased with Palatin Technologies, Inc. for providing a total return of 45% 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 examined the amount Palatin Technologies, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

However we must not forget that the EPS growth has been very strong over three years. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. So you may want to check if insiders are buying Palatin Technologies shares with their own money (free access).

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.

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