What We Learned About Geospace Technologies' (NASDAQ:GEOS) CEO Compensation
Rick Wheeler has been the CEO of Geospace Technologies Corporation (NASDAQ:GEOS) since 2014, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Geospace Technologies pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Check out our latest analysis for Geospace Technologies
How Does Total Compensation For Rick Wheeler Compare With Other Companies In The Industry?
According to our data, Geospace Technologies Corporation has a market capitalization of US$123m, and paid its CEO total annual compensation worth US$583k over the year to September 2020. This means that the compensation hasn't changed much from last year. We note that the salary portion, which stands at US$339.2k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$1.5m. This suggests that Rick Wheeler is paid below the industry median. Moreover, Rick Wheeler also holds US$1.1m worth of Geospace Technologies stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2020 | 2019 | Proportion (2020) |
Salary | US$339k | US$322k | 58% |
Other | US$244k | US$274k | 42% |
Total Compensation | US$583k | US$596k | 100% |
Talking in terms of the industry, salary represented approximately 22% of total compensation out of all the companies we analyzed, while other remuneration made up 78% of the pie. Geospace Technologies is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Geospace Technologies Corporation's Growth
Geospace Technologies Corporation's earnings per share (EPS) grew 79% per year over the last three years. It saw its revenue drop 8.4% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Geospace Technologies Corporation Been A Good Investment?
Given the total shareholder loss of 40% over three years, many shareholders in Geospace Technologies Corporation are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
As we touched on above, Geospace Technologies Corporation is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However we must not forget that the EPS growth has been very strong over three years. Although we would've liked to see positive investor returns, it would be bold of us to criticize CEO compensation when EPS are up. Shareholders, though, would ideally like to see shareholder returns head north before they agree to any raise.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Geospace Technologies that investors should be aware of in a dynamic business environment.
Switching gears from Geospace Technologies, 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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