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This article will reflect on the compensation paid to Timothy Brog who has served as CEO of Rubicon Technology, Inc. (NASDAQ:RBCN) since 2017. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Comparing Rubicon Technology, Inc.'s CEO Compensation With the industry
Our data indicates that Rubicon Technology, Inc. has a market capitalization of US$22m, and total annual CEO compensation was reported as US$795k for the year to December 2019. We note that's an increase of 42% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$350k.
On comparing similar-sized companies in the industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$491k. This suggests that Timothy Brog is paid more than the median for the industry. Moreover, Timothy Brog also holds US$774k worth of Rubicon Technology stock directly under their own name.
On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. Rubicon Technology is paying a higher share of its remuneration through a salary in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
Rubicon Technology, Inc.'s Growth
Over the past three years, Rubicon Technology, Inc. has seen its earnings per share (EPS) grow by 115% per year. Its revenue is up 45% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Rubicon Technology, Inc. Been A Good Investment?
With a total shareholder return of 5.2% over three years, Rubicon Technology, Inc. has done okay by shareholders. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
As we touched on above, Rubicon Technology, Inc. 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 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.
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 2 warning signs for Rubicon Technology that investors should think about before committing capital to this stock.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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