Should You Worry About GenMark Diagnostics, Inc.’s (NASDAQ:GNMK) CEO Pay Cheque?
In 2011 Hany Massarany was appointed CEO of GenMark Diagnostics, Inc. (NASDAQ:GNMK). First, this article will compare CEO compensation with compensation at similar sized companies. 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.
Check out our latest analysis for GenMark Diagnostics
How Does Hany Massarany’s Compensation Compare With Similar Sized Companies?
Our data indicates that GenMark Diagnostics, Inc. is worth US$292m, and total annual CEO compensation is US$3.5m. (This number is for the twelve months until 2017). While we always look at total compensation first, we note that the salary component is less, at US$490k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$100m to US$400m. The median total CEO compensation was US$967k.
Thus we can conclude that Hany Massarany receives more in total compensation than the median of a group of companies in the same market, and of similar size to GenMark Diagnostics, 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 a visual representation of the CEO compensation at GenMark Diagnostics, below.
Is GenMark Diagnostics, Inc. Growing?
On average over the last three years, GenMark Diagnostics, Inc. has shrunk earnings per share by 1.9% each year. It achieved revenue growth of 31% over the last year.
As investors, we are a bit wary of companies that have lower earnings per share, over three years. On the other hand, the strong revenue growth suggests the business is growing. These two metric are moving in different directions, so while it’s hard to be confident judging performance, we think the stock is worth watching.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has GenMark Diagnostics, Inc. Been A Good Investment?
Given the total loss of 17% over three years, many shareholders in GenMark Diagnostics, Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary…
We examined the amount GenMark Diagnostics, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Although we’d stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling GenMark Diagnostics (free visualization of insider trades).
Or you might prefer this data-rich interactive visualization of historic revenue and earnings.
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.
