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Chuck Kummeth has been the CEO of Bio-Techne Corporation (NASDAQ:TECH) since 2013, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Bio-Techne.
How Does Total Compensation For Chuck Kummeth Compare With Other Companies In The Industry?
At the time of writing, our data shows that Bio-Techne Corporation has a market capitalization of US$13b, and reported total annual CEO compensation of US$11m for the year to June 2020. That's a fairly small increase of 4.3% over the previous year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.1m.
In comparison with other companies in the industry with market capitalizations over US$8.0b , the reported median total CEO compensation was US$7.3m. Accordingly, our analysis reveals that Bio-Techne Corporation pays Chuck Kummeth north of the industry median. Furthermore, Chuck Kummeth directly owns US$56m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, around 16% of total compensation represents salary and 84% is other remuneration. In Bio-Techne's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Bio-Techne Corporation's Growth
Bio-Techne Corporation has seen its earnings per share (EPS) increase by 49% a year over the past three years. In the last year, its revenue is up 3.4%.
Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Bio-Techne Corporation Been A Good Investment?
Boasting a total shareholder return of 148% over three years, Bio-Techne Corporation has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
As we touched on above, Bio-Techne Corporation is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But EPS growth and shareholder returns have been top-notch for the past three years. So, in acknowledgment of the overall excellent performance, we believe CEO compensation is appropriate. And given most shareholders are probably very happy with recent returns, they might even think that Chuck deserves a raise!
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 3 warning signs for Bio-Techne that investors should think about before committing capital to this stock.
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.
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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