U.S. markets close in 2 hours 22 minutes
  • S&P 500

    3,901.63
    -0.19 (-0.00%)
     
  • Dow 30

    31,588.68
    +53.17 (+0.17%)
     
  • Nasdaq

    13,504.95
    -83.88 (-0.62%)
     
  • Russell 2000

    2,249.30
    -26.02 (-1.14%)
     
  • Crude Oil

    60.74
    +0.10 (+0.16%)
     
  • Gold

    1,733.70
    +10.70 (+0.62%)
     
  • Silver

    26.88
    +0.20 (+0.76%)
     
  • EUR/USD

    1.2090
    +0.0031 (+0.25%)
     
  • 10-Yr Bond

    1.4240
    -0.0220 (-1.52%)
     
  • GBP/USD

    1.3972
    +0.0051 (+0.37%)
     
  • USD/JPY

    106.7510
    +0.0210 (+0.02%)
     
  • BTC-USD

    47,881.13
    -1,111.01 (-2.27%)
     
  • CMC Crypto 200

    960.19
    -26.46 (-2.68%)
     
  • FTSE 100

    6,613.75
    +25.22 (+0.38%)
     
  • Nikkei 225

    29,408.17
    -255.33 (-0.86%)
     

Our View On PetMed Express' (NASDAQ:PETS) CEO Pay

  • Oops!
    Something went wrong.
    Please try again later.
Simply Wall St
·3 min read
  • Oops!
    Something went wrong.
    Please try again later.

This article will reflect on the compensation paid to Menderes Akdag who has served as CEO of PetMed Express, Inc. (NASDAQ:PETS) since 2001. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for PetMed Express

How Does Total Compensation For Menderes Akdag Compare With Other Companies In The Industry?

At the time of writing, our data shows that PetMed Express, Inc. has a market capitalization of US$585m, and reported total annual CEO compensation of US$1.3m for the year to March 2020. We note that's an increase of 52% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$618k.

On examining similar-sized companies in the industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$1.9m. Accordingly, PetMed Express pays its CEO under the industry median. What's more, Menderes Akdag holds US$12m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2020

2019

Proportion (2020)

Salary

US$618k

US$600k

47%

Other

US$686k

US$258k

53%

Total Compensation

US$1.3m

US$858k

100%

Talking in terms of the industry, salary represented approximately 21% of total compensation out of all the companies we analyzed, while other remuneration made up 79% of the pie. According to our research, PetMed Express has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
ceo-compensation

PetMed Express, Inc.'s Growth

Over the last three years, PetMed Express, Inc. has not seen its earnings per share change much, though there is a slight positive movement. In the last year, its revenue is up 11%.

We think the revenue growth is good. And the improvement in EPSis modest but respectable. So while performance isn't amazing, we think it really does seem quite respectable. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has PetMed Express, Inc. Been A Good Investment?

Since shareholders would have lost about 22% over three years, some PetMed Express, Inc. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

As we touched on above, PetMed Express, Inc. is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But the company isn't growing and total shareholder returns have been disappointing. So while we would not say that Menderes is generously paid, it would be good to see an improvement in business performance before there is talk about a raise.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for PetMed Express that you should be aware of before investing.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.