In 2005 Udi Mokady was appointed CEO of CyberArk Software Ltd. (NASDAQ:CYBR). 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 process should give us an idea about how appropriately the CEO is paid.
How Does Udi Mokady's Compensation Compare With Similar Sized Companies?
Our data indicates that CyberArk Software Ltd. is worth US$2.9b, and total annual CEO compensation was reported as US$9.0m for the year to December 2019. We note that's an increase of 34% above last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$390k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$2.0b to US$6.4b. The median total CEO compensation was US$5.7m.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. Talking in terms of the sector, salary represented approximately 14% of total compensation out of all the companies we analysed, while other remuneration made up 86% of the pie. Investors will find it intriguing that CyberArk Software paid a marginal salary to Udi Mokady, over the past year, focusing on non-salary compensation instead.
As you can see, Udi Mokady is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean CyberArk Software Ltd. is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. You can see, below, how CEO compensation at CyberArk Software has changed over time.
Is CyberArk Software Ltd. Growing?
Over the last three years CyberArk Software Ltd. has seen earnings per share (EPS) move in a positive direction by an average of 37% per year (using a line of best fit). It achieved revenue growth of 26% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. It could be important to check this free visual depiction of what analysts expect for the future.
Has CyberArk Software Ltd. Been A Good Investment?
I think that the total shareholder return of 47%, over three years, would leave most CyberArk Software Ltd. shareholders smiling. 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.
We examined the amount CyberArk Software Ltd. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. On top of that, in the same period, returns to shareholders have been great. As a result of this good performance, the CEO remuneration may well be quite reasonable. CEO compensation is an important area to keep your eyes on, but we've also identified 4 warning signs for CyberArk Software (1 can't be ignored!) that you should be aware of before investing here.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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