In 2017 Michael Castagna was appointed CEO of MannKind Corporation (NASDAQ:MNKD). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 process should give us an idea about how appropriately the CEO is paid.
How Does Michael Castagna's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that MannKind Corporation has a market cap of US$352m, and reported total annual CEO compensation of US$1.5m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$500k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$200m to US$800m. The median total CEO compensation was US$1.7m.
So Michael Castagna receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
You can see a visual representation of the CEO compensation at MannKind, below.
Is MannKind Corporation Growing?
Over the last three years MannKind Corporation has shrunk its earnings per share by an average of 24% per year (measured with a line of best fit). In the last year, its revenue is up 300%.
The reduction in earnings per share, over three years, is arguably concerning. But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. It could be important to check this free visual depiction of what analysts expect for the future.
Has MannKind Corporation Been A Good Investment?
With a three year total loss of 50%, MannKind Corporation would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
Remuneration for Michael Castagna is close enough to the median pay for a CEO of a similar sized company .
The per share growth could be better, in our view. And shareholder returns have been disappointing over the last three years. So it would take a bold person to suggest the pay is too modest. Shareholders may want to check for free if MannKind insiders are buying or selling shares.
Important note: MannKind may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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.
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