Is Sharps Compliance Corp’s (NASDAQ:SMED) CEO Pay Justified?
David Tusa became the CEO of Sharps Compliance Corp (NASDAQ:SMED) in 2010. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Sharps Compliance
How Does David Tusa’s Compensation Compare With Similar Sized Companies?
According to our data, Sharps Compliance Corp has a market capitalization of US$52m, and pays its CEO total annual compensation worth US$449k. Notably, that’s an increase of 21% over the year before. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO compensation to be US$296k.
As you can see, David Tusa is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Sharps Compliance Corp is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at Sharps Compliance has changed over time.
Is Sharps Compliance Corp Growing?
Over the last three years Sharps Compliance Corp has shrunk its earnings per share by an average of 59% per year. Its revenue is up 6.3% over last year.
Unfortunately, earnings per share have trended lower over the last three years. And the modest revenue growth over 12 months isn’t much comfort against the reduced earnings per share. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Sharps Compliance Corp Been A Good Investment?
With a three year total loss of 58%, Sharps Compliance Corp would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary…
We compared the total CEO remuneration paid by Sharps Compliance Corp, and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.
Over the same period, investors would have come away with nothing in the way of share price gains. Notably, the CEO remuneration is actually up on last year. In our opinion the CEO might be paid too generously!
Or you might rather take a peek at this analytical visualization of historic cash flow, 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 editorial-team@simplywallst.com.
