Does 22nd Century Group, Inc.'s (NYSEMKT:XXII) CEO Pay Matter?

Henry Sicignano became the CEO of 22nd Century Group, Inc. (NYSEMKT:XXII) in 2015. First, this article will compare CEO compensation with compensation at similar sized companies. 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 process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for 22nd Century Group

How Does Henry Sicignano's Compensation Compare With Similar Sized Companies?

According to our data, 22nd Century Group, Inc. has a market capitalization of US$292m, and pays its CEO total annual compensation worth US$711k. (This is based on the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$243k. 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$943k.

So Henry Sicignano is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.

You can see, below, how CEO compensation at 22nd Century Group has changed over time.

Is 22nd Century Group, Inc. Growing?

On average over the last three years, 22nd Century Group, Inc. has grown earnings per share (EPS) by 30% each year (using a line of best fit). Its revenue is up 80% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. You might want to check this free visual report on analyst forecasts for future earnings.

Has 22nd Century Group, Inc. Been A Good Investment?

Boasting a total shareholder return of 160% over three years, 22nd Century Group, Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

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

The company is growing earnings per share and total shareholder returns have been pleasing. So one could argue the CEO compensation is quite modest, if you consider company performance! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling 22nd Century Group (free visualization of insider trades).

If you want to buy a stock that is better than 22nd Century Group, this freelist of high return, low debt companies is a great place to look.

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.