Leonard Osser has been the CEO of Milestone Scientific Inc. (NYSEMKT:MLSS) since 2017, and this article will examine the executive’s compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
How Does Total Compensation For Leonard Osser Compare With Other Companies In The Industry?
Our data indicates that Milestone Scientific Inc. has a market capitalization of US$123m, and total annual CEO compensation was reported as US$691k for the year to December 2019. Notably, that’s an increase of 28% over the year before. While this analysis focuses on total compensation, it’s worth acknowledging that the salary portion is lower, valued at US$301k.
In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$629k. So it looks like Milestone Scientific compensates Leonard Osser in line with the median for the industry. Moreover, Leonard Osser also holds US$5.1m worth of Milestone Scientific stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Talking in terms of the industry, salary represented approximately 21% of total compensation out of all the companies we analyzed, while other remuneration made up 79% of the pie. It’s interesting to note that Milestone Scientific pays out a greater portion of remuneration through salary, compared to the industry. It’s important to note that a slant towards non-salary compensation suggests that total pay is tied to the company’s performance.
Milestone Scientific Inc.’s Growth
Milestone Scientific Inc.’s earnings per share (EPS) grew 5.5% per year over the last three years. It saw its revenue drop 15% over the last year.
We would prefer it if there was revenue growth, but the modest improvement in EPS is good. It’s hard to reach a conclusion about business performance right now. This may be one to watch. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Milestone Scientific Inc. Been A Good Investment?
Boasting a total shareholder return of 37% over three years, Milestone Scientific Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
As we noted earlier, Milestone Scientific pays its CEO in line with similar-sized companies belonging to the same industry. But the business isn’t reporting great numbers in terms of earnings growth. At the same time, shareholder returns have remained strong over the same period. There is room for improved company performance, but we don’t see the CEO compensation as a big issue here.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company’s key performance areas. We did our research and identified 3 warning signs (and 1 which is significant) in Milestone Scientific we think you should know about.
Important note: Milestone Scientific is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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