Brian Balbirnie has been the CEO of Issuer Direct Corporation (NYSEMKT:ISDR) since 2006. 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 process should give us an idea about how appropriately the CEO is paid.
How Does Brian Balbirnie's Compensation Compare With Similar Sized Companies?
According to our data, Issuer Direct Corporation has a market capitalization of US$45m, and paid its CEO total annual compensation worth US$200k over the year to December 2019. That's less than last year. Notably, the salary of US$200k is the vast majority of the CEO compensation. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$596k.
Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Issuer Direct. On a sector level, around 13% of total compensation represents salary and 87% is other remuneration. On a company level, Issuer Direct prefers to reward its CEO through a salary, opting not to pay Brian Balbirnie through non-salary benefits.
Most shareholders would consider it a positive that Brian Balbirnie takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it's important we delve into the performance of the actual business. You can see a visual representation of the CEO compensation at Issuer Direct, below.
Is Issuer Direct Corporation Growing?
On average over the last three years, Issuer Direct Corporation has shrunk earnings per share by 44% each year (measured with a line of best fit). In the last year, its revenue is up 8.4%.
Unfortunately, earnings per share have trended lower over the last three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. It could be important to check this free visual depiction of what analysts expect for the future.
Has Issuer Direct Corporation Been A Good Investment?
Given the total loss of 8.7% over three years, many shareholders in Issuer Direct Corporation are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
It appears that Issuer Direct Corporation remunerates its CEO below most similar sized companies.
Shareholders should note that compensation for Brian Balbirnie is under the median of a group of similar sized companies. But then, EPS growth is lacking and so are the returns to shareholders. While one could argue it is appropriate for the CEO to be paid less than other CEOs of similar sized companies, given company performance, we would not call the pay overly generous. Shifting gears from CEO pay for a second, we've picked out 2 warning signs for Issuer Direct that investors should be aware of in a dynamic business environment.
If you want to buy a stock that is better than Issuer Direct, this free list of high return, low debt companies is a great place to look.
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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Thank you for reading.