In 2016 Mitch Steiner was appointed CEO of Veru Inc. (NASDAQ:VERU). 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Mitch Steiner’s Compensation Compare With Similar Sized Companies?
Our data indicates that Veru Inc. is worth US$94m, and total annual CEO compensation is US$740k. (This number is for the twelve months until September 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$383k. 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$427k.
It would therefore appear that Veru Inc. pays Mitch Steiner 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. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Veru has changed over time.
Is Veru Inc. Growing?
Veru Inc. has reduced its earnings per share by an average of 95% a year, over the last three years (measured with a line of best fit). Its revenue is up 51% over last year.
Investors should note that, over three years, earnings per share are down. On the other hand, the strong revenue growth suggests the business is growing. 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. Shareholders might be interested in this free visualization of analyst forecasts.
Has Veru Inc. Been A Good Investment?
Given the total loss of 13% over three years, many shareholders in Veru Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
We examined the amount Veru 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.
The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Veru (free visualization of insider trades).
If you want to buy a stock that is better than Veru, this free list of high return, low debt companies is a great place to look.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.