Does Ocean Power Technologies, Inc.'s (NASDAQ:OPTT) CEO Salary Compare Well With Others?
George Kirby became the CEO of Ocean Power Technologies, Inc. (NASDAQ:OPTT) in 2015. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for Ocean Power Technologies
How Does George Kirby's Compensation Compare With Similar Sized Companies?
According to our data, Ocean Power Technologies, Inc. has a market capitalization of US$4.0m, and paid its CEO total annual compensation worth US$720k over the year to April 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$391k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$610k.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On a sector level, around 29% of total compensation represents salary and 71% is other remuneration. Ocean Power Technologies pays out 54% of aggregate payment in the shape of a salary, which is significantly higher than the industry average.
That means George Kirby receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context. You can see, below, how CEO compensation at Ocean Power Technologies has changed over time.
Is Ocean Power Technologies, Inc. Growing?
Over the last three years Ocean Power Technologies, Inc. has seen earnings per share (EPS) move in a positive direction by an average of 83% per year (using a line of best fit). It achieved revenue growth of 100% over the last year.
This demonstrates that the company has been improving recently. A good result. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Ocean Power Technologies, Inc. Been A Good Investment?
Given the total loss of 98% over three years, many shareholders in Ocean Power Technologies, Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
George Kirby is paid around what is normal for the leaders of comparable size companies.
We think that the EPS growth is very pleasing, but we find the returns over the last three years to be lacking. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. Taking a breather from CEO compensation, we've spotted 5 warning signs for Ocean Power Technologies (of which 3 are significant!) you should know about in order to have a holistic understanding of the stock.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Thank you for reading.
