Is Alaska Communications Systems Group, Inc.’s (NASDAQ:ALSK) CEO Pay Fair?

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Anand Vadapalli has been the CEO of Alaska Communications Systems Group, Inc. (NASDAQ:ALSK) since 2011. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for Alaska Communications Systems Group

How Does Anand Vadapalli’s Compensation Compare With Similar Sized Companies?

According to our data, Alaska Communications Systems Group, Inc. has a market capitalization of US$97m, and pays its CEO total annual compensation worth US$1.4m. (This number is for the twelve months until 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$450k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO compensation in that group is US$300k.

Thus we can conclude that Anand Vadapalli receives more in total compensation than the median of a group of companies in the same market, and of similar size to Alaska Communications Systems Group, Inc.. However, this doesn’t necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see a visual representation of the CEO compensation at Alaska Communications Systems Group, below.

NASDAQGS:ALSK CEO Compensation February 13th 19
NASDAQGS:ALSK CEO Compensation February 13th 19

Is Alaska Communications Systems Group, Inc. Growing?

Alaska Communications Systems Group, Inc. has reduced its earnings per share by an average of 59% a year, over the last three years (measured with a line of best fit). In the last year, its revenue changed by just -0.5%.

Sadly for shareholders, earnings per share are actually down, over three years. And the flat revenue is seriously uninspiring. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don’t have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Alaska Communications Systems Group, Inc. Been A Good Investment?

With a total shareholder return of 26% over three years, Alaska Communications Systems Group, Inc. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary…

We compared the total CEO remuneration paid by Alaska Communications Systems Group, Inc., and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.

While shareholder returns are acceptable, they don’t delight. So we doubt many shareholders would consider the CEO pay to be particularly modest! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Alaska Communications Systems Group (free visualization of insider trades).

If you want to buy a stock that is better than Alaska Communications Systems Group, this free list of high return, low debt companies is a great place to look.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

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.