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Is Ballantyne Strong, Inc's (NYSEMKT:BTN) CEO Being Overpaid?

Simply Wall St

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In 2015 Daniel Cerminara was appointed CEO of Ballantyne Strong, Inc (NYSEMKT:BTN). 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. 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.

See our latest analysis for Ballantyne Strong

How Does Daniel Cerminara's Compensation Compare With Similar Sized Companies?

Our data indicates that Ballantyne Strong, Inc is worth US$38m, and total annual CEO compensation is US$510k. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$225k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$470k.

That means Daniel Cerminara 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 a visual representation of the CEO compensation at Ballantyne Strong, below.

AMEX:BTN CEO Compensation, July 16th 2019

Is Ballantyne Strong, Inc Growing?

Over the last three years Ballantyne Strong, Inc has shrunk its earnings per share by an average of 66% per year (measured with a line of best fit). It saw its revenue drop -10% over the last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Ballantyne Strong, Inc Been A Good Investment?

Given the total loss of 50% over three years, many shareholders in Ballantyne Strong, Inc are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Daniel Cerminara is paid around what is normal the leaders of comparable size companies.

Returns have been disappointing and the company is not growing its earnings per share. Few would argue that it's wise for the company to pay any more, before returns improve. Whatever your view on compensation, you might want to check if insiders are buying or selling Ballantyne Strong shares (free trial).

Important note: Ballantyne Strong may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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.