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Does CyberOptics Corporation's (NASDAQ:CYBE) CEO Pay Reflect Performance?

Simply Wall St

Subodh Kulkarni became the CEO of CyberOptics Corporation (NASDAQ:CYBE) in 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for CyberOptics

How Does Subodh Kulkarni's Compensation Compare With Similar Sized Companies?

According to our data, CyberOptics Corporation has a market capitalization of US$99m, and pays its CEO total annual compensation worth US$1.0m. (This number is for the twelve months until December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$375k. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO total compensation to be US$489k.

As you can see, Subodh Kulkarni is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean CyberOptics Corporation is paying too much. 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 CyberOptics, below.

NasdaqGM:CYBE CEO Compensation, August 16th 2019

Is CyberOptics Corporation Growing?

CyberOptics Corporation has reduced its earnings per share by an average of 43% a year, over the last three years (measured with a line of best fit). Its revenue is up 18% over last year.

Sadly for shareholders, earnings per share are actually down, over three years. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for me to put aside my concerns around earnings. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.

Has CyberOptics Corporation Been A Good Investment?

With a three year total loss of 18%, CyberOptics Corporation would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We examined the amount CyberOptics 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.

Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.

Over the same period, investors would have come away with nothing in the way of share price gains. In our opinion the CEO might be paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling CyberOptics shares (free trial).

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 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.