Peter Kirlin became the CEO of Photronics, Inc. (NASDAQ:PLAB) in 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Peter Kirlin’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Photronics, Inc. has a market cap of US$656m, and is paying total annual CEO compensation of US$1.5m. (This figure is for the year to October 2018). We note that’s an increase of 31% above last year. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$591k. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO compensation of that group was US$2.2m.
So Peter Kirlin receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at Photronics, below.
Is Photronics, Inc. Growing?
On average over the last three years, Photronics, Inc. has shrunk earnings per share by 27% each year (measured with a line of best fit). In the last year, its revenue is up 16%.
Few shareholders would be pleased to read that earnings per share are lower over three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.
Has Photronics, Inc. Been A Good Investment?
Given the total loss of 1.6% over three years, many shareholders in Photronics, Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
Remuneration for Peter Kirlin is close enough to the median pay for a CEO of a similar sized company .
The company isn’t growing EPS, and shareholder returns have been disappointing. This contrasts with the growth in CEO remuneration, in the last year. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. Shareholders may want to check for free if Photronics insiders are buying or selling shares.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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If you spot an error that warrants correction, please contact the editor at email@example.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.