U.S. Markets open in 9 hrs 18 mins

Does Adesto Technologies Corporation's (NASDAQ:IOTS) CEO Salary Reflect Performance?

Simply Wall St

Narbeh Derhacobian has been the CEO of Adesto Technologies Corporation (NASDAQ:IOTS) since 2006. 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. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Adesto Technologies

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

At the time of writing, our data says that Adesto Technologies Corporation has a market cap of US$257m, and reported total annual CEO compensation of US$1.5m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$360k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$100m to US$400m. The median total CEO compensation was US$1.1m.

It would therefore appear that Adesto Technologies Corporation pays Narbeh Derhacobian more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

The graphic below shows how CEO compensation at Adesto Technologies has changed from year to year.

NasdaqCM:IOTS CEO Compensation, January 1st 2020

Is Adesto Technologies Corporation Growing?

On average over the last three years, Adesto Technologies Corporation has shrunk earnings per share by 6.2% each year (measured with a line of best fit). Its revenue is up 65% over last year.

Investors should note that, over three years, earnings per share are down. On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch. You might want to check this free visual report on analyst forecasts for future earnings.

Has Adesto Technologies Corporation Been A Good Investment?

Most shareholders would probably be pleased with Adesto Technologies Corporation for providing a total return of 325% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

We examined the amount Adesto Technologies Corporation pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

One might like to have seen stronger growth, but shareholder returns have been pleasing, over the last three years. Considering this fine result for investors, we daresay the CEO compensation might be apt. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Adesto Technologies.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

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. Thank you for reading.