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In 2015 David Spitz was appointed CEO of ChannelAdvisor Corporation (NYSE:ECOM). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does David Spitz's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that ChannelAdvisor Corporation has a market cap of US$254m, and is paying total annual CEO compensation of US$1.7m. (This is based on the year to December 2018). That's below the compensation, last year. We think total compensation is more important but we note that the CEO salary is lower, at US$411k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO total compensation was US$1.1m.
As you can see, David Spitz is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean ChannelAdvisor Corporation is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at ChannelAdvisor, below.
Is ChannelAdvisor Corporation Growing?
ChannelAdvisor Corporation has increased its earnings per share (EPS) by an average of 24% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 4.5%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.
Has ChannelAdvisor Corporation Been A Good Investment?
Since shareholders would have lost about 37% over three years, some ChannelAdvisor Corporation shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We compared the total CEO remuneration paid by ChannelAdvisor Corporation, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. On the other hand returns to investors over the same period have probably disappointed many. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. Whatever your view on compensation, you might want to check if insiders are buying or selling ChannelAdvisor shares (free trial).
If you want to buy a stock that is better than ChannelAdvisor, 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 firstname.lastname@example.org. 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.