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Andy Marsh has been the CEO of Plug Power Inc. (NASDAQ:PLUG) since 2008. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Andy Marsh’s Compensation Compare With Similar Sized Companies?
Our data indicates that Plug Power Inc. is worth US$394m, and total annual CEO compensation is US$3.1m. (This number is for the twelve months until 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$600k. When we examined a selection of companies with market caps ranging from US$200m to US$800m, we found the median CEO compensation was US$1.5m.
Thus we can conclude that Andy Marsh receives more in total compensation than the median of a group of companies in the same market, and of similar size to Plug Power 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.
The graphic below shows how CEO compensation at Plug Power has changed from year to year.
Is Plug Power Inc. Growing?
On average over the last three years, Plug Power Inc. has shrunk earnings per share by 22% each year (measured with a line of best fit). Its revenue is up 76% over last year.
The reduction in earnings per share, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. In conclusion we can’t form a strong opinion about business performance yet; but it’s one worth watching. You might want to check this free visual report on analyst forecasts for future earnings.
Has Plug Power Inc. Been A Good Investment?
Given the total loss of 9.1% over three years, many shareholders in Plug Power Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
We examined the amount Plug Power 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.
The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Shareholders may wish to consider further research. Although we don’t think the CEO pay is too high, it is probably more on the generous side of things. So you may want to check if insiders are buying Plug Power 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.
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 firstname.lastname@example.org. 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.