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Is Applied Genetic Technologies Corporation (NASDAQ:AGTC) Overpaying Its CEO?

Simply Wall St

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Sue Washer has been the CEO of Applied Genetic Technologies Corporation (NASDAQ:AGTC) since 2002. 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. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Applied Genetic Technologies

How Does Sue Washer's Compensation Compare With Similar Sized Companies?

According to our data, Applied Genetic Technologies Corporation has a market capitalization of US$69m, and pays its CEO total annual compensation worth US$1.1m. (This number is for the twelve months until June 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$502k. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO total compensation to be US$468k.

As you can see, Sue Washer is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Applied Genetic Technologies Corporation 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 a visual representation of the CEO compensation at Applied Genetic Technologies, below.

NasdaqGM:AGTC CEO Compensation, July 17th 2019

Is Applied Genetic Technologies Corporation Growing?

On average over the last three years, Applied Genetic Technologies Corporation has shrunk earnings per share by 57% each year (measured with a line of best fit). It achieved revenue growth of 72% over the last year.

The reduction in earnings per share, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. Shareholders might be interested in this free visualization of analyst forecasts.

Has Applied Genetic Technologies Corporation Been A Good Investment?

With a three year total loss of 76%, Applied Genetic Technologies Corporation 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 the total CEO remuneration paid by Applied Genetic Technologies Corporation, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Although we'd stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. Whatever your view on compensation, you might want to check if insiders are buying or selling Applied Genetic Technologies shares (free trial).

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.

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.

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. Thank you for reading.