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Is Information Services Group, Inc.'s (NASDAQ:III) CEO Paid Enough Relative To Peers?

Simply Wall St

Mike Connors became the CEO of Information Services Group, Inc. (NASDAQ:III) in 2006. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Information Services Group

How Does Mike Connors's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Information Services Group, Inc. has a market cap of US$120m, and reported total annual CEO compensation of US$3.0m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$833k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$526k.

Thus we can conclude that Mike Connors receives more in total compensation than the median of a group of companies in the same market, and of similar size to Information Services Group, Inc.. However, this doesn't necessarily mean the pay is too high. 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 Information Services Group has changed over time.

NasdaqGM:III CEO Compensation, January 1st 2020

Is Information Services Group, Inc. Growing?

Information Services Group, Inc. has increased its earnings per share (EPS) by an average of 75% a year, over the last three years (using a line of best fit). It saw its revenue drop 2.3% 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. You might want to check this free visual report on analyst forecasts for future earnings.

Has Information Services Group, Inc. Been A Good Investment?

Since shareholders would have lost about 31% over three years, some Information Services Group, Inc. shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We examined the amount Information Services Group, 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. Having said that, shareholders may be disappointed with the weak returns over the last three years. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. Shareholders may want to check for free if Information Services Group insiders are buying or selling shares.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

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. Thank you for reading.