Will Febbo has been the CEO of OptimizeRx Corporation (NASDAQ:OPRX) since 2016, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether OptimizeRx pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Comparing OptimizeRx Corporation's CEO Compensation With the industry
According to our data, OptimizeRx Corporation has a market capitalization of US$219m, and paid its CEO total annual compensation worth US$834k over the year to December 2019. Notably, that's a decrease of 9.7% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$300k.
On examining similar-sized companies in the industry with market capitalizations between US$100m and US$400m, we discovered that the median CEO total compensation of that group was US$1.1m. So it looks like OptimizeRx compensates Will Febbo in line with the median for the industry. Furthermore, Will Febbo directly owns US$3.6m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. OptimizeRx is paying a higher share of its remuneration through a salary in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
OptimizeRx Corporation's Growth
Over the past three years, OptimizeRx Corporation has seen its earnings per share (EPS) grow by 6.5% per year. It achieved revenue growth of 21% over the last year.
This revenue growth could really point to a brighter future. And the improvement in earnings per share is modest but respectable. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has OptimizeRx Corporation Been A Good Investment?
Boasting a total shareholder return of 316% over three years, OptimizeRx Corporation has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
As previously discussed, Will is compensated close to the median for companies of its size, and which belong to the same industry. But the company has been found wanting in terms of earnings growth over the past three years. At the same time, shareholder returns have remained strong over the same period. We would like to see EPS growth from the business, although we wouldn't say the CEO compensation is high.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for OptimizeRx that investors should think about before committing capital to this stock.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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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