Yahoo Finance Should You Be Pleased About The CEO Pay At Mesoblast Limited's (ASX:MSB)
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Silviu Itescu became the CEO of Mesoblast Limited (ASX:MSB) in 2011. First, this article will compare CEO compensation with compensation at similar sized companies. 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 process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Mesoblast
How Does Silviu Itescu's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Mesoblast Limited has a market cap of AU$738m, and is paying total annual CEO compensation of US$2.0m. (This is based on the year to June 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$1.0m. We looked at a group of companies with market capitalizations from AU$281m to AU$1.1b, and the median CEO total compensation was AU$1.1m.
As you can see, Silviu Itescu is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Mesoblast Limited is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see a visual representation of the CEO compensation at Mesoblast, below.
Is Mesoblast Limited Growing?
On average over the last three years, Mesoblast Limited has grown earnings per share (EPS) by 9.9% each year (using a line of best fit). It achieved revenue growth of 1.5% over the last year.
I'm not particularly impressed by the revenue growth, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Shareholders might be interested in this free visualization of analyst forecasts.
Has Mesoblast Limited Been A Good Investment?
Since shareholders would have lost about 36% over three years, some Mesoblast Limited shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
We compared total CEO remuneration at Mesoblast Limited with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Although we'd stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. Shareholders may want to check for free if Mesoblast insiders are buying or selling shares.
Important note: Mesoblast 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.
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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.
