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Is Box, Inc.'s (NYSE:BOX) CEO Overpaid Relative To Its Peers?

Simply Wall St

Aaron Levie has been the CEO of Box, Inc. (NYSE:BOX) since 2005. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Box

How Does Aaron Levie's Compensation Compare With Similar Sized Companies?

According to our data, Box, Inc. has a market capitalization of US$2.3b, and paid its CEO total annual compensation worth US$3.3m over the year to January 2019. We think total compensation is more important but we note that the CEO salary is lower, at US$180k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. When we examined a selection of companies with market caps ranging from US$1.0b to US$3.2b, we found the median CEO total compensation was US$3.9m.

So Aaron Levie is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at Box has changed over time.

NYSE:BOX CEO Compensation, February 10th 2020
NYSE:BOX CEO Compensation, February 10th 2020

Is Box, Inc. Growing?

On average over the last three years, Box, Inc. has grown earnings per share (EPS) by 12% each year (using a line of best fit). Its revenue is up 16% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Box, Inc. Been A Good Investment?

Since shareholders would have lost about 15% over three years, some Box, Inc. shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Remuneration for Aaron Levie is close enough to the median pay for a CEO of a similar sized company .

We think that the EPS growth is very pleasing, but it's disappointing to see negative shareholder returns over three years. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Box (free visualization of insider trades).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.