In 2008 Robert Kay was appointed CEO of iBio, Inc. (NYSEMKT:IBIO). 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Robert Kay’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that iBio, Inc. has a market cap of US$19m, and is paying total annual CEO compensation of US$315k. (This figure is for the year to June 2018). Notably, the salary of US$315k is the vast majority of the CEO compensation. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO compensation in that group is US$297k.
So Robert Kay receives a similar amount to the median CEO pay, amongst 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 a visual representation of the CEO compensation at iBio, below.
Is iBio, Inc. Growing?
iBio, Inc. has reduced its earnings per share by an average of 8.1% a year, over the last three years (measured with a line of best fit). Its revenue is up 88% over last year.
As investors, we are a bit wary of companies that have lower earnings per share, over three years. But on the other hand, revenue growth is strong, suggesting a brighter future. 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. We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has iBio, Inc. Been A Good Investment?
Given the total loss of 83% over three years, many shareholders in iBio, Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
Robert Kay is paid around what is normal the leaders of comparable size companies.
The per share growth could be better, in our view. And we think the shareholder returns – over three years – have been underwhelming. So suffice it to say we don’t think the compensation is modest! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at iBio.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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If you spot an error that warrants correction, please contact the editor at email@example.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.