We have been pretty impressed with the performance at Brightcove Inc. (NASDAQ:BCOV) recently and CEO Jeff Ray deserves a mention for their role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 11 May 2021. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. Here is our take on why we think CEO compensation is not extravagant.

Check out our latest analysis for Brightcove

How Does Total Compensation For Jeff Ray Compare With Other Companies In The Industry?

According to our data, Brightcove Inc. has a market capitalization of US$601m, and paid its CEO total annual compensation worth US$2.0m over the year to December 2020. We note that's an increase of 37% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$400k.

On comparing similar companies from the same industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$1.9m. This suggests that Brightcove remunerates its CEO largely in line with the industry average. What's more, Jeff Ray holds US$2.4m 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. Brightcove pays out 20% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Brightcove Inc.'s Growth Numbers

Brightcove Inc.'s earnings per share (EPS) grew 24% per year over the last three years. In the last year, its revenue is up 8.6%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Brightcove Inc. Been A Good Investment?

We think that the total shareholder return of 44%, over three years, would leave most Brightcove Inc. shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. Seeing that earnings growth and share price performance seems to be on the right path, the more pressing focus for shareholders at the AGM may be how the board and management plans to turn the company into a sustainably profitable one.

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 3 warning signs for Brightcove that investors should think about before committing capital to this stock.

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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