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Marc Hedrick became the CEO of Cytori Therapeutics, Inc. (NASDAQ:CYTX) in 2014. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. 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 Marc Hedrick's Compensation Compare With Similar Sized Companies?
According to our data, Cytori Therapeutics, Inc. has a market capitalization of US$5.3m, and pays its CEO total annual compensation worth US$615k. (This is based on the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$510k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$464k.
Thus we can conclude that Marc Hedrick receives more in total compensation than the median of a group of companies in the same market, and of similar size to Cytori Therapeutics, Inc.. However, this doesn't necessarily mean the pay is too high. 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 Cytori Therapeutics has changed over time.
Is Cytori Therapeutics, Inc. Growing?
Cytori Therapeutics, Inc. has increased its earnings per share (EPS) by an average of 39% a year, over the last three years (using a line of best fit). In the last year, its revenue changed by just -0.06%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. Revenue growth is a real positive for growth, but ultimately profits are more important. Shareholders might be interested in this free visualization of analyst forecasts.
Has Cytori Therapeutics, Inc. Been A Good Investment?
Given the total loss of 99% over three years, many shareholders in Cytori Therapeutics, Inc. are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We compared total CEO remuneration at Cytori Therapeutics, Inc. with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
However we must not forget that the EPS growth has been very strong over three years. However, the returns to investors are far less impressive, over the same period. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. Shareholders may want to check for free if Cytori Therapeutics insiders are buying or selling shares.
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.