VJ Joshi became the CEO of 3D Systems Corporation (NYSE:DDD) in 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. This process should give us an idea about how appropriately the CEO is paid.
How Does VJ Joshi's Compensation Compare With Similar Sized Companies?
Our data indicates that 3D Systems Corporation is worth US$989m, and total annual CEO compensation was reported as US$3.4m for the year to December 2019. That's a notable increase of 59% on last year. While we always look at total compensation first, we note that the salary component is less, at US$953k. 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$400m to US$1.6b, and the median CEO total compensation was US$3.3m.
Now let's take a look at the pay mix on an industry and company level to gain a better understanding of where 3D Systems stands. On a sector level, around 26% of total compensation represents salary and 74% is other remuneration. So it seems like there isn't a significant difference between 3D Systems and the broader market, in terms of salary allocation in the overall compensation package.
That means VJ Joshi 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. The graphic below shows how CEO compensation at 3D Systems has changed from year to year.
Is 3D Systems Corporation Growing?
On average over the last three years, 3D Systems Corporation has shrunk earnings per share by 16% each year (measured with a line of best fit). In the last year, its revenue is down 8.5%.
Few shareholders would be pleased to read that earnings per share are lower over three years. And the fact that revenue is down year on year arguably paints an ugly picture. 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 3D Systems Corporation Been A Good Investment?
Given the total loss of 50% over three years, many shareholders in 3D Systems Corporation are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
VJ Joshi is paid around the same as most CEOs of similar size companies.
The company isn't growing EPS, and shareholder returns have been disappointing. This doesn't look great when you consider CEO remuneration is up on last year. Suffice it to say, we don't think the CEO is underpaid! Looking into other areas, we've picked out 2 warning signs for 3D Systems that investors should think about before committing capital to this 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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