Our Take On ChannelAdvisor's (NYSE:ECOM) CEO Salary

David Spitz became the CEO of ChannelAdvisor Corporation (NYSE:ECOM) in 2015, 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 look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for ChannelAdvisor.

See our latest analysis for ChannelAdvisor

Comparing ChannelAdvisor Corporation's CEO Compensation With the industry

At the time of writing, our data shows that ChannelAdvisor Corporation has a market capitalization of US$504m, and reported total annual CEO compensation of US$1.5m for the year to December 2019. That's a notable decrease of 11% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$411k.

In comparison with other companies in the industry with market capitalizations ranging from US$200m to US$800m, the reported median CEO total compensation was US$1.5m. So it looks like ChannelAdvisor compensates David Spitz in line with the median for the industry. Moreover, David Spitz also holds US$2.2m worth of ChannelAdvisor stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 14% of total compensation represents salary, while the remainder of 86% is other remuneration. It's interesting to note that ChannelAdvisor pays out a greater portion of remuneration through salary, compared to the industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ChannelAdvisor Corporation's Growth

Over the past three years, ChannelAdvisor Corporation has seen its earnings per share (EPS) grow by 90% per year. In the last year, its revenue is up 4.1%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has ChannelAdvisor Corporation Been A Good Investment?

Most shareholders would probably be pleased with ChannelAdvisor Corporation for providing a total return of 96% 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...

As we touched on above, ChannelAdvisor Corporation is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. The company is growing EPS and total shareholder returns have been pleasing. Indeed, many might consider that David is compensated rather modestly, given the solid company performance! Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.

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. That's why we did some digging and identified 2 warning signs for ChannelAdvisor that you should be aware of before investing.

Important note: ChannelAdvisor is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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