In 2013 Steve Rizzone was appointed CEO of Energous Corporation (NASDAQ:WATT). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Steve Rizzone’s Compensation Compare With Similar Sized Companies?
According to our data, Energous Corporation has a market capitalization of US$217m, and pays its CEO total annual compensation worth US$3.4m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$365k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO compensation was US$932k.
Thus we can conclude that Steve Rizzone receives more in total compensation than the median of a group of companies in the same market, and of similar size to Energous Corporation. However, this doesn’t necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Energous has changed from year to year.
Is Energous Corporation Growing?
Energous Corporation has increased its earnings per share (EPS) by an average of 1.1% a year, over the last three years It saw its revenue drop -61% over the last year.
I would prefer it if there was revenue growth, but the improvement in EPS is good. In conclusion we can’t form a strong opinion about business performance yet; but it’s one worth watching.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Energous Corporation Been A Good Investment?
Energous Corporation has generated a total shareholder return of 5.6% over three years, so most shareholders wouldn’t be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared total CEO remuneration at Energous Corporation with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. So it’s certainly hard to argue that the CEO is modestly paid, although we don’t see the remuneration as an issue. Whatever your view on compensation, you might want to check if insiders are buying or selling Energous shares (free trial).
Or you might prefer examine intently this intuitive graph showing past earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.