Armando Anido became the CEO of Zynerba Pharmaceuticals, Inc. (NASDAQ:ZYNE) in 2014. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Armando Anido's Compensation Compare With Similar Sized Companies?
Our data indicates that Zynerba Pharmaceuticals, Inc. is worth US$98m, and total annual CEO compensation was reported as US$1.4m for the year to December 2019. That's below the compensation, last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$568k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$607k.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On a sector level, around 30% of total compensation represents salary and 70% is other remuneration. According to our research, Zynerba Pharmaceuticals has allocated a higher percentage of pay to salary in comparison to the broader sector.
As you can see, Armando Anido is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Zynerba Pharmaceuticals, Inc. is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous. You can see a visual representation of the CEO compensation at Zynerba Pharmaceuticals, below.
Is Zynerba Pharmaceuticals, Inc. Growing?
Over the last three years Zynerba Pharmaceuticals, Inc. has seen earnings per share (EPS) move in a positive direction by an average of 15% per year (using a line of best fit). It achieved revenue growth of 25% over the last year.
This demonstrates that the company has been improving recently. A good result. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Zynerba Pharmaceuticals, Inc. Been A Good Investment?
Given the total loss of 81% over three years, many shareholders in Zynerba Pharmaceuticals, Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
We compared the total CEO remuneration paid by Zynerba Pharmaceuticals, Inc., and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. Taking a breather from CEO compensation, we've spotted 5 warning signs for Zynerba Pharmaceuticals (of which 1 is potentially serious!) you should know about in order to have a holistic understanding of the stock.
If you want to buy a stock that is better than Zynerba Pharmaceuticals, this free list of high return, low debt companies is a great place to look.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.