Is 3Pea International, Inc.’s (NASDAQ:TPNL) CEO Salary Justified?

In 2006 Mark Newcomer was appointed CEO of 3Pea International, Inc. (NASDAQ:TPNL). 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.

See our latest analysis for 3Pea International

How Does Mark Newcomer’s Compensation Compare With Similar Sized Companies?

Our data indicates that 3Pea International, Inc. is worth US$340m, and total annual CEO compensation is US$552k. (This is based on the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$424k. We looked at a group of companies with market capitalizations from US$200m to US$800m, and the median CEO total compensation was US$1.5m.

A first glance this seems like a real positive for shareholders, since Mark Newcomer is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you’ll need to understand the business better before you can form an opinion.

The graphic below shows how CEO compensation at 3Pea International has changed from year to year.

NasdaqCM:TPNL CEO Compensation, March 14th 2019
NasdaqCM:TPNL CEO Compensation, March 14th 2019

Is 3Pea International, Inc. Growing?

On average over the last three years, 3Pea International, Inc. has grown earnings per share (EPS) by 83% each year (using a line of best fit). It achieved revenue growth of 54% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. You might want to check this free visual report on analyst forecasts for future earnings.

Has 3Pea International, Inc. Been A Good Investment?

Most shareholders would probably be pleased with 3Pea International, Inc. for providing a total return of 2752% 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.

In Summary…

It appears that 3Pea International, Inc. remunerates its CEO below most similar sized companies. Since the business is growing, many would argue this suggests the pay is modest. The strong history of shareholder returns might even have some thinking that Mark Newcomer deserves a raise!

It is relatively rare to see a modestly paid CEO when performance is so impressive. It would be even more positive if company insiders are buying shares. So you may want to check if insiders are buying 3Pea International shares with their own money (free access).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.