We Discuss Whether ChromaDex Corporation's (NASDAQ:CDXC) CEO Is Due For A Pay Rise

Shareholders will be pleased by the impressive results for ChromaDex Corporation (NASDAQ:CDXC) recently and CEO Rob Fried has played a key role. At the upcoming AGM on 17 June 2021, they would be interested to hear about the company strategy going forward and get a chance to cast their votes on resolutions such as executive remuneration and other company matters. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

View our latest analysis for ChromaDex

Comparing ChromaDex Corporation's CEO Compensation With the industry

Our data indicates that ChromaDex Corporation has a market capitalization of US$682m, and total annual CEO compensation was reported as US$1.1m for the year to December 2020. That's a notable decrease of 34% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$519k.

For comparison, other companies in the same industry with market capitalizations ranging between US$400m and US$1.6b had a median total CEO compensation of US$2.1m. That is to say, Rob Fried is paid under the industry median. Moreover, Rob Fried also holds US$15m worth of ChromaDex stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2020	2019	Proportion (2020)
Salary	US$519k	US$487k	46%
Other	US$607k	US$1.2m	54%
Total Compensation	US$1.1m	US$1.7m	100%

On an industry level, around 14% of total compensation represents salary and 86% is other remuneration. ChromaDex is paying a higher share of its remuneration through a salary in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ChromaDex Corporation's Growth

ChromaDex Corporation's earnings per share (EPS) grew 16% per year over the last three years. In the last year, its revenue is up 18%.

This demonstrates that the company has been improving recently and is good news for the shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has ChromaDex Corporation Been A Good Investment?

We think that the total shareholder return of 170%, over three years, would leave most ChromaDex Corporation shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. In saying that, some shareholders may feel that the more important issues to be addressed may be how the management plans to steer the company towards sustainable profitability in the future.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 2 warning signs for ChromaDex that investors should be aware of in a dynamic business environment.

Important note: ChromaDex is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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