Yahoo Finance Why SeaSpine Holdings' (NASDAQ:SPNE) CEO Pay Matters
Keith Valentine became the CEO of SeaSpine Holdings Corporation (NASDAQ:SPNE) in 2015, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for SeaSpine Holdings.
Check out our latest analysis for SeaSpine Holdings
How Does Total Compensation For Keith Valentine Compare With Other Companies In The Industry?
Our data indicates that SeaSpine Holdings Corporation has a market capitalization of US$413m, and total annual CEO compensation was reported as US$1.8m for the year to December 2019. That's a slight decrease of 7.5% on the prior year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$566k.
On examining similar-sized companies in the industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$2.2m. So it looks like SeaSpine Holdings compensates Keith Valentine in line with the median for the industry. Moreover, Keith Valentine also holds US$4.2m worth of SeaSpine Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$566k | US$547k | 31% |
Other | US$1.3m | US$1.4m | 69% |
Total Compensation | US$1.8m | US$2.0m | 100% |
On an industry level, around 20% of total compensation represents salary and 80% is other remuneration. According to our research, SeaSpine Holdings has allocated a higher percentage of pay to salary in comparison to the wider industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at SeaSpine Holdings Corporation's Growth Numbers
SeaSpine Holdings Corporation's earnings per share (EPS) grew 13% per year over the last three years. The trailing twelve months of revenue was pretty much the same as the prior period.
Shareholders would be glad to know that the company has improved itself over the last few years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has SeaSpine Holdings Corporation Been A Good Investment?
Boasting a total shareholder return of 48% over three years, SeaSpine Holdings Corporation has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
To Conclude...
As we touched on above, SeaSpine Holdings Corporation is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Few would be critical of the leadership, since returns have been juicy and EPS are moving in the right direction. Although the pay is close to the industry median, overall performance is excellent, so we don't think the CEO is paid too generously. In fact, shareholders might even think the CEO deserves a raise as a reward due to the fantastic returns generated.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 3 warning signs for SeaSpine Holdings that investors should be aware of in a dynamic business environment.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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.
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