Is Barnwell Industries, Inc.’s (NYSEMKT:BRN) CEO Pay Justified?

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Alexander Kinzler has been the CEO of Barnwell Industries, Inc. (NYSEMKT:BRN) since 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Barnwell Industries

How Does Alexander Kinzler’s Compensation Compare With Similar Sized Companies?

Our data indicates that Barnwell Industries, Inc. is worth US$11m, and total annual CEO compensation is US$481k. (This number is for the twelve months until September 2018). While we always look at total compensation first, we note that the salary component is less, at US$380k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$453k.

So Alexander Kinzler receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at Barnwell Industries has changed over time.

AMEX:BRN CEO Compensation, June 4th 2019
AMEX:BRN CEO Compensation, June 4th 2019

Is Barnwell Industries, Inc. Growing?

Barnwell Industries, Inc. has reduced its earnings per share by an average of 87% a year, over the last three years (measured with a line of best fit). Its revenue is up 16% over last year.

Sadly for shareholders, earnings per share are actually down, over three years. And while it’s good to see some good revenue growth recently, the growth isn’t really fast enough for me to put aside my concerns around earnings. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO. We don’t have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Barnwell Industries, Inc. Been A Good Investment?

Given the total loss of 13% over three years, many shareholders in Barnwell Industries, Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

Remuneration for Alexander Kinzler is close enough to the median pay for a CEO of a similar sized company .

Returns have been disappointing and the company is not growing its earnings per share. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. So you may want to check if insiders are buying Barnwell Industries shares with their own money (free access).

Important note: Barnwell Industries may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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 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. Thank you for reading.