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Gerri Henwood has been the CEO of Recro Pharma, Inc. (NASDAQ:REPH) since 2008. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. 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 Gerri Henwood's Compensation Compare With Similar Sized Companies?
According to our data, Recro Pharma, Inc. has a market capitalization of US$215m, and pays its CEO total annual compensation worth US$2.4m. (This number is for the twelve months until December 2018). Notably, that's an increase of 16% over the year before. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$599k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO total compensation was US$1.2m.
Thus we can conclude that Gerri Henwood receives more in total compensation than the median of a group of companies in the same market, and of similar size to Recro Pharma, 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 Recro Pharma, below.
Is Recro Pharma, Inc. Growing?
On average over the last three years, Recro Pharma, Inc. has shrunk earnings per share by 45% each year (measured with a line of best fit). Its revenue is up 14% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.
Has Recro Pharma, Inc. Been A Good Investment?
Recro Pharma, Inc. has served shareholders reasonably well, with a total return of 22% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
We examined the amount Recro Pharma, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.
And while shareholder returns have been respectable, they have hardly been superb. We also note that the CEO compensation is well up on last year. 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 Recro Pharma (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.