Harlan Waksal became the CEO of Kadmon Holdings, Inc. (NYSE:KDMN) in 2014. 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Harlan Waksal's Compensation Compare With Similar Sized Companies?
According to our data, Kadmon Holdings, Inc. has a market capitalization of US$346m, and paid its CEO total annual compensation worth US$3.7m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$500k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We looked at a group of companies with market capitalizations from US$200m to US$800m, and the median CEO total compensation was US$1.8m.
Thus we can conclude that Harlan Waksal receives more in total compensation than the median of a group of companies in the same market, and of similar size to Kadmon Holdings, Inc.. However, this doesn't necessarily mean the pay is too high. 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 Kadmon Holdings, below.
Is Kadmon Holdings, Inc. Growing?
Over the last three years Kadmon Holdings, Inc. has grown its earnings per share (EPS) by an average of 120% per year (using a line of best fit). It saw its revenue drop 84% over the last year.
This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. You might want to check this free visual report on analyst forecasts for future earnings.
Has Kadmon Holdings, Inc. Been A Good Investment?
Given the total loss of 62% over three years, many shareholders in Kadmon Holdings, Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
We compared total CEO remuneration at Kadmon Holdings, Inc. with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. 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 Kadmon Holdings shares (free trial).
Important note: Kadmon Holdings may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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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.