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Is Calix, Inc.’s (NYSE:CALX) CEO Paid At A Competitive Rate?

Ricardo Landis

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Carl Russo became the CEO of Calix, Inc. (NYSE:CALX) in 2002. First, this article will compare CEO compensation with compensation at similar sized companies. 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.

Check out our latest analysis for Calix

How Does Carl Russo’s Compensation Compare With Similar Sized Companies?

According to our data, Calix, Inc. has a market capitalization of US$416m, and pays its CEO total annual compensation worth US$1.9m. (This figure is for the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$500k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$200m to US$800m. The median total CEO compensation was US$1.5m.

That means Carl Russo receives fairly typical remuneration for the CEO of a company that size. 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.

The graphic below shows how CEO compensation at Calix has changed from year to year.

NYSE:CALX CEO Compensation February 14th 19

Is Calix, Inc. Growing?

Over the last three years Calix, Inc. has shrunk its earnings per share by an average of 14% per year (measured with a line of best fit). Its revenue is down -14% over last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.

Has Calix, Inc. Been A Good Investment?

I think that the total shareholder return of 34%, over three years, would leave most Calix, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary…

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

We’re not seeing great strides in earnings per share, but the company has clearly pleased some investors, given the returns over the last three years. So we think most shareholders wouldn’t be too worried about CEO compensation, which is close to the median for similar sized companies. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Calix.

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.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.