Yahoo News Does Vicor Corporation's (NASDAQ:VICR) CEO Pay Reflect Performance?
Patrizio Vinciarelli has been the CEO of Vicor Corporation (NASDAQ:VICR) since 1981. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
View our latest analysis for Vicor
How Does Patrizio Vinciarelli's Compensation Compare With Similar Sized Companies?
Our data indicates that Vicor Corporation is worth US$2.2b, and total annual CEO compensation was reported as US$444k for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$390k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$1.0b to US$3.2b. The median total CEO compensation was US$3.8m.
A first glance this seems like a real positive for shareholders, since Patrizio Vinciarelli is paid less than the average total compensation paid by similar sized companies. However, before we heap on the praise, we should delve deeper to understand business performance.
The graphic below shows how CEO compensation at Vicor has changed from year to year.
Is Vicor Corporation Growing?
On average over the last three years, Vicor Corporation has grown earnings per share (EPS) by 102% each year (using a line of best fit). The trailing twelve months of revenue was pretty much the same as the prior period.
This demonstrates that the company has been improving recently. A good result. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Shareholders might be interested in this free visualization of analyst forecasts.
Has Vicor Corporation Been A Good Investment?
Most shareholders would probably be pleased with Vicor Corporation for providing a total return of 256% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
Vicor Corporation is currently paying its CEO below what is normal for companies of its size.
Many would consider this to indicate that the pay is modest since the business is growing. The strong history of shareholder returns might even have some thinking that Patrizio Vinciarelli deserves a raise! It is relatively rare to see a modestly paid CEO when performance is so impressive. The cherry on top would be if company insiders are buying shares with their own money. Shareholders may want to check for free if Vicor insiders are buying or selling shares.
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.
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.
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