What We Learned About Energous' (NASDAQ:WATT) CEO Compensation
Steve Rizzone has been the CEO of Energous Corporation (NASDAQ:WATT) since 2013, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Energous pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
View our latest analysis for Energous
Comparing Energous Corporation's CEO Compensation With the industry
According to our data, Energous Corporation has a market capitalization of US$78m, and paid its CEO total annual compensation worth US$593k over the year to December 2019. That's a notable decrease of 9.1% on last year. We note that the salary portion, which stands at US$365.0k constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$463k. So it looks like Energous compensates Steve Rizzone in line with the median for the industry. Furthermore, Steve Rizzone directly owns US$870k worth of shares in the company.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$365k | US$365k | 62% |
Other | US$228k | US$287k | 38% |
Total Compensation | US$593k | US$652k | 100% |
Talking in terms of the industry, salary represented approximately 31% of total compensation out of all the companies we analyzed, while other remuneration made up 69% of the pie. It's interesting to note that Energous pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
A Look at Energous Corporation's Growth Numbers
Energous Corporation's earnings per share (EPS) grew 32% per year over the last three years. It achieved revenue growth of 34% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Energous Corporation Been A Good Investment?
Given the total shareholder loss of 81% over three years, many shareholders in Energous Corporation are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
As previously discussed, Steve is compensated close to the median for companies of its size, and which belong to the same industry. On the other hand, the company has logged negative shareholder returns over the previous three years. But EPS growth is moving in a favorable direction, certainly a positive sign. Overall, we wouldn't say Steve is paid an unjustified compensation, but shareholders might not favor a raise before shareholder returns show a positive trend.
CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 6 warning signs for Energous (of which 3 make us uncomfortable!) that you should know about in order to have a holistic understanding of the stock.
Switching gears from Energous, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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