Is AXIS Capital Holdings Limited's (NYSE:AXS) CEO Being Overpaid?
In 2012 Albert Benchimol was appointed CEO of AXIS Capital Holdings Limited (NYSE:AXS). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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.
See our latest analysis for AXIS Capital Holdings
How Does Albert Benchimol's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that AXIS Capital Holdings Limited has a market cap of US$5.3b, and is paying total annual CEO compensation of US$7.8m. (This is based on the year to December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$1.1m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12b. The median total CEO compensation was US$6.9m.
So Albert Benchimol is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
The graphic below shows how CEO compensation at AXIS Capital Holdings has changed from year to year.
Is AXIS Capital Holdings Limited Growing?
AXIS Capital Holdings Limited has reduced its earnings per share by an average of 62% a year, over the last three years (measured with a line of best fit). Its revenue is up 2.5% over last year.
Unfortunately, earnings per share have trended lower over the last three years. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.
Has AXIS Capital Holdings Limited Been A Good Investment?
AXIS Capital Holdings Limited has generated a total shareholder return of 20% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Albert Benchimol is paid around what is normal the leaders of comparable size companies.
We're not seeing great strides in earnings per share, and total returns were decent but not amazing in the last three years. We do not think the CEO pay is a problem, but it's probably fair to say that many shareholders would like to see improved performance, before any pay rise occurs. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at AXIS Capital Holdings.
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.
