Peter Bauer has been the CEO of Mimecast Limited (NASDAQ:MIME) since 2003, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Mimecast.
Comparing Mimecast Limited's CEO Compensation With the industry
According to our data, Mimecast Limited has a market capitalization of US$3.3b, and paid its CEO total annual compensation worth US$2.3m over the year to March 2020. We note that's an increase of 37% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$370k.
On comparing similar companies from the same industry with market caps ranging from US$2.0b to US$6.4b, we found that the median CEO total compensation was US$4.9m. In other words, Mimecast pays its CEO lower than the industry median. Furthermore, Peter Bauer directly owns US$177m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, around 13% of total compensation represents salary and 87% is other remuneration. According to our research, Mimecast has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Mimecast Limited's Growth
Mimecast Limited has seen its earnings per share (EPS) increase by 72% a year over the past three years. Its revenue is up 21% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Mimecast Limited Been A Good Investment?
Most shareholders would probably be pleased with Mimecast Limited for providing a total return of 59% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
As we noted earlier, Mimecast pays its CEO lower than the norm for similar-sized companies belonging to the same industry. Considering robust EPS growth, we believe Peter to be modestly paid. Given the strong history of shareholder returns, the shareholders are probably very happy with Peter's performance.
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 Mimecast that investors should be aware of in a dynamic business environment.
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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