Richard Wright became the CEO of The Alkaline Water Company Inc. (NASDAQ:WTER) in 2017, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Alkaline Water.
Comparing The Alkaline Water Company Inc.'s CEO Compensation With the industry
According to our data, The Alkaline Water Company Inc. has a market capitalization of US$101m, and paid its CEO total annual compensation worth US$193k over the year to March 2019. That's mostly flat as compared to the prior year's compensation. We note that the salary portion, which stands at US$168.0k constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$248k. This suggests that Alkaline Water remunerates its CEO largely in line with the industry average. What's more, Richard Wright holds US$6.3m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, roughly 18% of total compensation represents salary and 82% is other remuneration. It's interesting to note that Alkaline Water pays out a greater portion of remuneration through salary, compared to the industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
A Look at The Alkaline Water Company Inc.'s Growth Numbers
Over the past three years, The Alkaline Water Company Inc. has seen its earnings per share (EPS) grow by 2.1% per year. It achieved revenue growth of 23% over the last year.
This revenue growth could really point to a brighter future. And the modest growth in earnings per share isn't bad, either. So while performance isn't amazing, we think it really does seem quite respectable. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has The Alkaline Water Company Inc. Been A Good Investment?
The Alkaline Water Company Inc. has generated a total shareholder return of 13% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
As we noted earlier, Alkaline Water pays its CEO in line with similar-sized companies belonging to the same industry. On the other hand, earnings per share and shareholder returns have been stable over the last three years, but have not grown substantially. Considering the steady performance, it's tough to call out CEO compensation as too high, but shareholders might want to see more robust growth metrics before agreeing to a future raise.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 4 warning signs for Alkaline Water that investors should think about before committing capital to this stock.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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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