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Is Aclaris Therapeutics, Inc.'s (NASDAQ:ACRS) CEO Paid At A Competitive Rate?

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Simply Wall St
·3 min read
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In 2012 Neal Walker was appointed CEO of Aclaris Therapeutics, Inc. (NASDAQ:ACRS). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. 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.

View our latest analysis for Aclaris Therapeutics

How Does Neal Walker's Compensation Compare With Similar Sized Companies?

According to our data, Aclaris Therapeutics, Inc. has a market capitalization of US$60m, and paid its CEO total annual compensation worth US$4.4m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$550k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO total compensation to be US$522k.

Thus we can conclude that Neal Walker receives more in total compensation than the median of a group of companies in the same market, and of similar size to Aclaris Therapeutics, Inc.. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see a visual representation of the CEO compensation at Aclaris Therapeutics, below.

NasdaqGS:ACRS CEO Compensation, February 24th 2020
NasdaqGS:ACRS CEO Compensation, February 24th 2020

Is Aclaris Therapeutics, Inc. Growing?

On average over the last three years, Aclaris Therapeutics, Inc. has shrunk earnings per share by 28% each year (measured with a line of best fit). In the last year, its revenue is up 64%.

Investors should note that, over three years, earnings per share are down. But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. It could be important to check this free visual depiction of what analysts expect for the future.

Has Aclaris Therapeutics, Inc. Been A Good Investment?

With a three year total loss of 95%, Aclaris Therapeutics, Inc. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

We compared total CEO remuneration at Aclaris Therapeutics, Inc. with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.

Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Although we'd stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Aclaris Therapeutics (free visualization of insider trades).

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.