Andy Crockett became the CEO of KalVista Pharmaceuticals, Inc. (NASDAQ:KALV) in 2016, 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 KalVista Pharmaceuticals.
How Does Total Compensation For Andy Crockett Compare With Other Companies In The Industry?
Our data indicates that KalVista Pharmaceuticals, Inc. has a market capitalization of US$766m, and total annual CEO compensation was reported as US$1.7m for the year to April 2020. That's a notable decrease of 47% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$556k.
On comparing similar companies from the same industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$2.2m. From this we gather that Andy Crockett is paid around the median for CEOs in the industry. What's more, Andy Crockett holds US$5.6m 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, around 25% of total compensation represents salary and 75% is other remuneration. KalVista Pharmaceuticals 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.
A Look at KalVista Pharmaceuticals, Inc.'s Growth Numbers
Over the last three years, KalVista Pharmaceuticals, Inc. has not seen its earnings per share change much, though there is a slight positive movement. It saw its revenue drop 62% over the last year.
We generally like to see a little revenue growth, but the modest improvement in EPS is good. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 KalVista Pharmaceuticals, Inc. Been A Good Investment?
Boasting a total shareholder return of 219% over three years, KalVista Pharmaceuticals, Inc. has done well by shareholders. 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.
As we touched on above, KalVista Pharmaceuticals, Inc. is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, the company's EPS growth numbers over the last three years is not that impressive. At the same time, shareholder returns have remained strong over the same period. We would like to see EPS growth from the business, although we wouldn't say the CEO compensation is high.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 3 warning signs for KalVista Pharmaceuticals that investors should look into moving forward.
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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