In 2014 Ron Konezny was appointed CEO of Digi International Inc. (NASDAQ:DGII). 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Ron Konezny’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Digi International Inc. has a market cap of US$368m, and is paying total annual CEO compensation of US$1.8m. (This number is for the twelve months until September 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$465k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$200m to US$800m. The median total CEO compensation was US$1.8m.
So Ron Konezny 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, below, how CEO compensation at Digi International has changed over time.
Is Digi International Inc. Growing?
Digi International Inc. has reduced its earnings per share by an average of 35% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 35%.
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. It’s hard to reach a conclusion about business performance right now. This may be one to watch.
Has Digi International Inc. Been A Good Investment?
With a total shareholder return of 16% over three years, Digi International Inc. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
Remuneration for Ron Konezny is close enough to the median pay for a CEO of a similar sized company .
The company isn’t showing particularly great growth, and shareholder turns haven’t been particularly inspiring in the last few years. While there is room for improvement, we haven’t seen evidence to suggest the pay is too generous. So you may want to check if insiders are buying Digi 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.
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