Performance at Model N, Inc. (NYSE:MODN) has been reasonably good and CEO Jason Blessing has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 18 February 2022. However, some shareholders may still want to keep CEO compensation within reason.
Comparing Model N, Inc.'s CEO Compensation With the industry
Our data indicates that Model N, Inc. has a market capitalization of US$931m, and total annual CEO compensation was reported as US$5.6m for the year to September 2021. We note that's an increase of 15% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$515k.
In comparison with other companies in the industry with market capitalizations ranging from US$400m to US$1.6b, the reported median CEO total compensation was US$2.5m. This suggests that Jason Blessing is paid more than the median for the industry. Moreover, Jason Blessing also holds US$6.2m worth of Model N stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
| Component | 2021 | 2020 | Proportion (2021) |
| Salary | US$515k | US$500k | 9% |
| Other | US$5.0m | US$4.3m | 91% |
| Total Compensation | US$5.6m | US$4.8m | 100% |
On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. In Model N's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Model N, Inc.'s Growth
Model N, Inc. saw earnings per share stay pretty flat over the last three years. In the last year, its revenue is up 22%.
The reduction in EPS, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Model N, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Model N, Inc. 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.
To Conclude...
Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 4 warning signs for Model N that you should be aware of before investing.
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.
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