In 2014 Pat MacKin was appointed CEO of CryoLife, Inc. (NYSE:CRY). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Pat MacKin's Compensation Compare With Similar Sized Companies?
According to our data, CryoLife, Inc. has a market capitalization of US$1.1b, and paid its CEO total annual compensation worth US$3.2m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$660k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO total compensation of that group was US$2.5m.
That means Pat MacKin receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at CryoLife has changed over time.
Is CryoLife, Inc. Growing?
Over the last three years CryoLife, Inc. has shrunk its earnings per share by an average of 81% per year (measured with a line of best fit). It achieved revenue growth of 11% over the last year.
Sadly for shareholders, earnings per share are actually down, over three years. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for me to put aside my concerns around earnings. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.
Has CryoLife, Inc. Been A Good Investment?
Most shareholders would probably be pleased with CryoLife, Inc. for providing a total return of 61% over three years. 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.
Remuneration for Pat MacKin is close enough to the median pay for a CEO of a similar sized company .
The company isn't growing earnings per share, but shareholder returns have been strong over the last three years. So we think most shareholders wouldn't be too worried about CEO compensation, which is close to the median for similar sized companies. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at CryoLife.
If you want to buy a stock that is better than CryoLife, this free list of high return, low debt companies is a great place to look.
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