Should You Worry About RigNet, Inc.'s (NASDAQ:RNET) CEO Pay?

Steve Pickett became the CEO of RigNet, Inc. (NASDAQ:RNET) in 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for RigNet

How Does Steve Pickett's Compensation Compare With Similar Sized Companies?

According to our data, RigNet, Inc. has a market capitalization of US$248m, and pays its CEO total annual compensation worth US$1.5m. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$485k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$100m to US$400m. The median total CEO compensation was US$1.0m.

It would therefore appear that RigNet, Inc. pays Steve Pickett 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. So this freereport on the analyst consensus forecasts could help you make a master move on this stock.

You can see a visual representation of the CEO compensation at RigNet, below.

Is RigNet, Inc. Growing?

RigNet, Inc. has reduced its earnings per share by an average of 7.3% a year, over the last three years. Its revenue is up 17% over last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO.

Has RigNet, Inc. Been A Good Investment?

With a three year total loss of 40%, RigNet, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We examined the amount RigNet, Inc. 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.

Earnings per share have not grown in three years, and the revenue growth fails to impress us.

Arguably worse, investors are without a positive return for the last three years. Some might well form the view that the CEO is paid too generously! So you may want to check if insiders are buying RigNet shares with their own money (free access).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this freelist of interesting companies.

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 editorial-team@simplywallst.com.

Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.