Our View On Genie Energy's (NYSE:GNE) CEO Pay

Michael Stein has been the CEO of Genie Energy Ltd. (NYSE:GNE) since 2017, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Genie Energy pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Genie Energy

Comparing Genie Energy Ltd.'s CEO Compensation With the industry

At the time of writing, our data shows that Genie Energy Ltd. has a market capitalization of US$232m, and reported total annual CEO compensation of US$779k for the year to December 2019. We note that's a decrease of 54% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$350k.

For comparison, other companies in the same industry with market capitalizations ranging between US$100m and US$400m had a median total CEO compensation of US$418k. This suggests that Michael Stein is paid more than the median for the industry. What's more, Michael Stein holds US$1.6m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 14% of total compensation out of all the companies we analyzed, while other remuneration made up 86% of the pie. It's interesting to note that Genie Energy pays out a greater portion of remuneration through salary, compared to the industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Genie Energy Ltd.'s Growth

Over the past three years, Genie Energy Ltd. has seen its earnings per share (EPS) grow by 91% per year. Its revenue is up 23% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Genie Energy Ltd. Been A Good Investment?

Most shareholders would probably be pleased with Genie Energy Ltd. for providing a total return of 49% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

As previously discussed, Michael is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. However, Genie Energy has produced strong EPS growth and shareholder returns over the last three years. So, in acknowledgment of the overall excellent performance, we believe CEO compensation is appropriate. Given the strong history of shareholder returns, the shareholders are probably very happy with Michael's performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 2 warning signs for Genie Energy 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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