Mikkel Svane became the CEO of Zendesk Inc (NYSE:ZEN) in 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. 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.
View our latest analysis for Zendesk
How Does Mikkel Svane's Compensation Compare With Similar Sized Companies?
Our data indicates that Zendesk Inc is worth US$5.8b, and total annual CEO compensation is US$2m. That's below the compensation, last year. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12.0b. The median total CEO compensation was US$7m.
Most shareholders would consider it a positive that Mikkel Svane takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Zendesk has changed over time.
Is Zendesk Inc Growing?
On average over the last three years, Zendesk Inc has shrunk earnings per share by 6.2% each year. In the last year, its revenue is up 38%.
As investors, we do are a bit wary of companies that have lower earnings per share, over three years. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. So this freevisualization of the analyst consensus on future earnings could help you make the right decision about whether to buy, sell, or hold.
Has Zendesk Inc Been A Good Investment?
Boasting a total shareholder return of 127% over three years, Zendesk Inc has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
It appears that Zendesk Inc remunerates its CEO below most similar sized companies.
It's well worth noting that while Mikkel Svane is paid below what is normal at companies of similar size, the returns have been very pleasing, over the last three years. We would like to see EPS growth, but in our view it seems the CEO is modestly remunerated. I like to research companies that do not pay too much to the CEO. One data point that I like to check is whether insiders have bought shares recently.
But note: Zendesk may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.