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Is Finjan Holdings, Inc. (NASDAQ:FNJN) Excessively Paying Its CEO?

Simply Wall St

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Phil Hartstein has been the CEO of Finjan Holdings, Inc. (NASDAQ:FNJN) since 2014. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Finjan Holdings

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$64m, and is paying total annual CEO compensation of US$2.1m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$390k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$462k.

As you can see, Phil Hartstein is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Finjan Holdings, Inc. is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

You can see, below, how CEO compensation at Finjan Holdings has changed over time.

NasdaqCM:FNJN CEO Compensation, July 11th 2019

Is Finjan Holdings, Inc. Growing?

Finjan Holdings, Inc. has increased its earnings per share (EPS) by an average of 65% a year, over the last three years (using a line of best fit). It saw its revenue drop -81% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. Revenue growth is a real positive for growth, but ultimately profits are more important. It could be important to check this free visual depiction of what analysts expect for the future.

Has Finjan Holdings, Inc. Been A Good Investment?

Finjan Holdings, Inc. has served shareholders reasonably well, with a total return of 25% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

We compared the total CEO remuneration paid by Finjan Holdings, Inc., and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. We also note that, over the same time frame, shareholder returns haven't been bad. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. So you may want to check if insiders are buying Finjan Holdings shares with their own money (free access).

Important note: Finjan 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.

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.