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Zackary Irani has been the CEO of Biomerica, Inc. (NASDAQ:BMRA) since 1997. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 method should give us information to assess how appropriately the company pays the CEO.
How Does Zackary Irani's Compensation Compare With Similar Sized Companies?
Our data indicates that Biomerica, Inc. is worth US$30m, and total annual CEO compensation was reported as US$329k for the year to May 2019. That's a notable increase of 11% on last year. While we always look at total compensation first, we note that the salary component is less, at US$137k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$492k.
A first glance this seems like a real positive for shareholders, since Zackary Irani is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Biomerica has changed over time.
Is Biomerica, Inc. Growing?
On average over the last three years, Biomerica, Inc. has shrunk earnings per share by 9.6% each year (measured with a line of best fit). Its revenue is down 6.5% over last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.
Has Biomerica, Inc. Been A Good Investment?
Biomerica, Inc. has generated a total shareholder return of 18% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
It appears that Biomerica, Inc. remunerates its CEO below most similar sized companies.
Shareholders should note that compensation for Zackary Irani is under the median of a group of similar sized companies. But the business isn't growing earnings per share, and the returns to shareholders haven't been wonderful. So while shareholders shouldn't be overly concerned about CEO compensation, we suspect most would prefer see improved performance, before increasing pay. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Biomerica (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
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. Thank you for reading.