Does Finjan Holdings, Inc.’s (NASDAQ:FNJN) CEO Pay Compare Well With Peers?
In 2014 Phil Hartstein was appointed CEO of Finjan Holdings, Inc. (NASDAQ:FNJN). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
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How Does Phil Hartstein’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Finjan Holdings, Inc. has a market cap of US$78m, and is paying total annual CEO compensation of US$2.0m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$350k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO compensation was US$303k.
Thus we can conclude that Phil Hartstein receives more in total compensation than the median of a group of companies in the same market, and of similar size to Finjan Holdings, 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, below, how CEO compensation at Finjan Holdings has changed over time.
Is Finjan Holdings, Inc. Growing?
Over the last three years Finjan Holdings, Inc. has grown its earnings per share (EPS) by an average of 113% per year (using a line of best fit). In the last year, its revenue is up 198%.
This demonstrates that the company has been improving recently. A good result. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business.
You might want to check this free visual report on analyst forecasts for future earnings.
Has Finjan Holdings, Inc. Been A Good Investment?
I think that the total shareholder return of 156%, over three years, would leave most Finjan Holdings, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary…
We examined the amount Finjan Holdings, Inc. 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.
However we must not forget that the EPS growth has been very strong over three years. On top of that, in the same period, returns to shareholders have been great. So, considering this good performance, the CEO compensation may be quite appropriate. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Finjan Holdings (free visualization of insider trades).
Or you might rather take a peek at this analytical visualization of historic cash flow, earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
