In 2017 Mike Altschaefl was appointed CEO of Orion Energy Systems, Inc. (NASDAQ:OESX). 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 - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Mike Altschaefl's Compensation Compare With Similar Sized Companies?
Our data indicates that Orion Energy Systems, Inc. is worth US$102m, and total annual CEO compensation was reported as US$645k for the year to March 2019. We think total compensation is more important but we note that the CEO salary is lower, at US$325k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$510k.
So Mike Altschaefl is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at Orion Energy Systems has changed from year to year.
Is Orion Energy Systems, Inc. Growing?
Over the last three years Orion Energy Systems, Inc. has grown its earnings per share (EPS) by an average of 60% per year (using a line of best fit). In the last year, its revenue is up 118%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. You might want to check this free visual report on analyst forecasts for future earnings.
Has Orion Energy Systems, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Orion Energy Systems, Inc. for providing a total return of 90% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Mike Altschaefl is paid around the same as most CEOs of similar size companies.
The company is growing earnings per share and total shareholder returns have been pleasing. Indeed, many might consider the pay rather modest, given the solid company performance! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Orion Energy Systems (free visualization of insider trades).
Important note: Orion Energy Systems 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.
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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.