Vlado Bosanac became the CEO of MyFiziq Limited (ASX:MYQ) in 2016. 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. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Vlado Bosanac's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that MyFiziq Limited has a market cap of AU$29m, and reported total annual CEO compensation of AU$7.4m for the year to June 2018. We think total compensation is more important but we note that the CEO salary is lower, at AU$270k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We examined a group of similar sized companies, with market capitalizations of below AU$296m. The median CEO total compensation in that group is AU$379k.
It would therefore appear that MyFiziq Limited pays Vlado Bosanac more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at MyFiziq has changed from year to year.
Is MyFiziq Limited Growing?
Over the last three years MyFiziq Limited has shrunk its earnings per share by an average of 30% per year (measured with a line of best fit). Its revenue is down 91% 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. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has MyFiziq Limited Been A Good Investment?
Most shareholders would probably be pleased with MyFiziq Limited for providing a total return of 465% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
We examined the amount MyFiziq Limited 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.
Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. On the other hand, returns have been good, so the company is doing something right. So on this analysis we'd stop short of criticizing the level of CEO compensation. Shareholders may want to check for free if MyFiziq 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.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.