Najeeb Ghauri has been the CEO of NetSol Technologies, Inc. (NASDAQ:NTWK) since 2006. 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. 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 Najeeb Ghauri's Compensation Compare With Similar Sized Companies?
Our data indicates that NetSol Technologies, Inc. is worth US$62m, and total annual CEO compensation was reported as US$1.3m for the year to June 2019. Notably, that's an increase of 21% over the year before. We think total compensation is more important but we note that the CEO salary is lower, at US$675k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$503k.
Thus we can conclude that Najeeb Ghauri receives more in total compensation than the median of a group of companies in the same market, and of similar size to NetSol Technologies, 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 NetSol Technologies, below.
Is NetSol Technologies, Inc. Growing?
NetSol Technologies, Inc. has increased its earnings per share (EPS) by an average of 60% a year, over the last three years (using a line of best fit). Its revenue is up 11% over last year.
This demonstrates that the company has been improving recently. A good result. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has NetSol Technologies, Inc. Been A Good Investment?
Given the total loss of 17% over three years, many shareholders in NetSol 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.
We examined the amount NetSol Technologies, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. However, the returns to investors are far less impressive, over the same period. This doesn't look great when you consider CEO remuneration is up on last year. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling NetSol Technologies (free visualization of insider trades).
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 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.