Yahoo Movies What We Learned About Perficient's (NASDAQ:PRFT) CEO Compensation
Jeff Davis became the CEO of Perficient, Inc. (NASDAQ:PRFT) in 2009, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Perficient pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
View our latest analysis for Perficient
Comparing Perficient, Inc.'s CEO Compensation With the industry
Our data indicates that Perficient, Inc. has a market capitalization of US$1.5b, and total annual CEO compensation was reported as US$6.0m for the year to December 2019. We note that's an increase of 16% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$625k.
In comparison with other companies in the industry with market capitalizations ranging from US$1.0b to US$3.2b, the reported median CEO total compensation was US$6.0m. This suggests that Perficient remunerates its CEO largely in line with the industry average. Furthermore, Jeff Davis directly owns US$21m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$625k | US$622k | 10% |
Other | US$5.3m | US$4.5m | 90% |
Total Compensation | US$6.0m | US$5.2m | 100% |
On an industry level, roughly 14% of total compensation represents salary and 86% is other remuneration. In Perficient'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.
Perficient, Inc.'s Growth
Perficient, Inc. has seen its earnings per share (EPS) increase by 30% a year over the past three years. It achieved revenue growth of 7.7% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. 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 Perficient, Inc. Been A Good Investment?
Boasting a total shareholder return of 140% over three years, Perficient, Inc. has done well by shareholders. 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.
To Conclude...
As we noted earlier, Perficient pays its CEO in line with similar-sized companies belonging to the same industry. Investors would surely be happy to see that returns have been great, and that EPS is up. Indeed, many might consider that Jeff is compensated rather modestly, given the solid company performance! In fact, shareholders might even think the CEO deserves a raise as a reward due to the fantastic returns generated.
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 Perficient 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.
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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