- Oops!Something went wrong.Please try again later.
Pat McEnany has been the CEO of Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX) since 2002, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Comparing Catalyst Pharmaceuticals, Inc.'s CEO Compensation With the industry
At the time of writing, our data shows that Catalyst Pharmaceuticals, Inc. has a market capitalization of US$359m, and reported total annual CEO compensation of US$3.4m for the year to December 2019. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$548k.
On examining similar-sized companies in the industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$2.3m. This suggests that Pat McEnany is paid more than the median for the industry. Moreover, Pat McEnany also holds US$17m worth of Catalyst Pharmaceuticals stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Speaking on an industry level, nearly 23% of total compensation represents salary, while the remainder of 77% is other remuneration. Catalyst Pharmaceuticals pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Catalyst Pharmaceuticals, Inc.'s Growth Numbers
Over the past three years, Catalyst Pharmaceuticals, Inc. has seen its earnings per share (EPS) grow by 87% per year. In the last year, its revenue is up 184%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Catalyst Pharmaceuticals, Inc. Been A Good Investment?
Catalyst Pharmaceuticals, Inc. has generated a total shareholder return of 28% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
As we noted earlier, Catalyst Pharmaceuticals pays its CEO higher than the norm for similar-sized companies belonging to the same industry. But the company has impressed us with its EPS growth, over three years. We also think investor returns are steady over the same time period. While it may be worth researching further, we don't see a problem with the high CEO pay, given the good EPS growth.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Catalyst Pharmaceuticals that you should be aware of before investing.
Switching gears from Catalyst Pharmaceuticals, 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email email@example.com.