U.S. Markets closed

Is Cognex Corporation (NASDAQ:CGNX) Excessively Paying Its CEO?

Simply Wall St

Rob Willett has been the CEO of Cognex Corporation (NASDAQ:CGNX) since 2011. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for Cognex

How Does Rob Willett's Compensation Compare With Similar Sized Companies?

Our data indicates that Cognex Corporation is worth US$8.2b, and total annual CEO compensation was reported as US$2.6m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$376k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. 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$6.8m.

A first glance this seems like a real positive for shareholders, since Rob Willett is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.

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

NasdaqGS:CGNX CEO Compensation, September 21st 2019

Is Cognex Corporation Growing?

Over the last three years Cognex Corporation has grown its earnings per share (EPS) by an average of 14% per year (using a line of best fit). In the last year, its revenue is down 3.8%.

This shows that the company has improved itself over the last few years. Good news for shareholders. While it would be good to see revenue growth, profits matter more in the end. You might want to check this free visual report on analyst forecasts for future earnings.

Has Cognex Corporation Been A Good Investment?

Most shareholders would probably be pleased with Cognex Corporation for providing a total return of 91% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...


It appears that Cognex Corporation remunerates its CEO below most similar sized companies.

Since the business is growing, many would argue this suggests the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Rob Willett deserves a raise! It's not often we see shareholders do so well, and yet the CEO is paid modestly. The cherry on top would be if company insiders are buying shares with their own money. Whatever your view on compensation, you might want to check if insiders are buying or selling Cognex 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.