Alvin Murstein has been the CEO of Medallion Financial Corp. (NASDAQ:MFIN) since 1996. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Alvin Murstein’s Compensation Compare With Similar Sized Companies?
Our data indicates that Medallion Financial Corp. is worth US$141m, and total annual CEO compensation is US$1.4m. (This figure is for the year to 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$869k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO compensation was US$301k.
As you can see, Alvin Murstein is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Medallion Financial Corp. is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Medallion Financial, below.
Is Medallion Financial Corp. Growing?
Medallion Financial Corp. has reduced its earnings per share by an average of 103% a year, over the last three years. Its revenue is up 386% over last year.
Investors should note that, over three years, earnings per share are down. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. These two metric are moving in different directions, so while it’s hard to be confident judging performance, we think the stock is worth watching.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Medallion Financial Corp. Been A Good Investment?
With a three year total loss of 8.9%, Medallion Financial Corp. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
We examined the amount Medallion Financial Corp. pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Although we’d stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Medallion Financial (free visualization of insider trades).
Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.