Charif Elansari is the CEO of Dropsuite Limited (ASX:DSE), and in this article, we analyze the executive's compensation package 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 Dropsuite.
Comparing Dropsuite Limited's CEO Compensation With the industry
At the time of writing, our data shows that Dropsuite Limited has a market capitalization of AU$85m, and reported total annual CEO compensation of AU$354k for the year to December 2019. That's a notable decrease of 8.9% on last year. We note that the salary portion, which stands at AU$249.7k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below AU$263m, we found that the median total CEO compensation was AU$334k. So it looks like Dropsuite compensates Charif Elansari in line with the median for the industry. What's more, Charif Elansari holds AU$8.7m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, around 59% of total compensation represents salary and 41% is other remuneration. Dropsuite 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.
Dropsuite Limited's Growth
Dropsuite Limited's earnings per share (EPS) grew 63% per year over the last three years. In the last year, its revenue is down 1.6%.
This demonstrates that the company has been improving recently and is good news for the shareholders. 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 Dropsuite Limited Been A Good Investment?
Boasting a total shareholder return of 150% over three years, Dropsuite Limited 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 noted earlier, Dropsuite pays its CEO in line with similar-sized companies belonging to the same industry. Few would be critical of the leadership, since returns have been juicy and EPS are moving in the right direction. Indeed, many might consider that Charif is compensated rather modestly, given the solid company performance! Stockholders might even be okay with a bump in pay, seeing as how investor returns have been so strong.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 4 warning signs for Dropsuite that investors should think about before committing capital to this stock.
Switching gears from Dropsuite, 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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