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Is Adesto Technologies Corporation (NASDAQ:IOTS) Excessively Paying Its CEO?

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Narbeh Derhacobian has been the CEO of Adesto Technologies Corporation (NASDAQ:IOTS) since 2006. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Adesto Technologies

How Does Narbeh Derhacobian's Compensation Compare With Similar Sized Companies?

According to our data, Adesto Technologies Corporation has a market capitalization of US$239m, and pays its CEO total annual compensation worth US$1.0m. (This number is for the twelve months until December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$360k. We examined companies with market caps from US$100m to US$400m, and discovered that the median CEO total compensation of that group was US$1.2m.

That means Narbeh Derhacobian receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at Adesto Technologies has changed over time.

NasdaqCM:IOTS CEO Compensation, June 11th 2019
NasdaqCM:IOTS CEO Compensation, June 11th 2019

Is Adesto Technologies Corporation Growing?

Adesto Technologies Corporation has increased its earnings per share (EPS) by an average of 18% a year, over the last three years (using a line of best fit). It achieved revenue growth of 60% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Shareholders might be interested in this free visualization of analyst forecasts.

Has Adesto Technologies Corporation Been A Good Investment?

Boasting a total shareholder return of 104% over three years, Adesto Technologies Corporation has done well by shareholders. 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...

Narbeh Derhacobian is paid around the same as most CEOs of similar size companies.

The company is growing earnings per share and total shareholder returns have been pleasing. So one could argue the CEO compensation is quite modest, if you consider company performance! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Adesto Technologies.

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

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.

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