How Does Amicus Therapeutics' (NASDAQ:FOLD) CEO Pay Compare With Company Performance?
John Crowley has been the CEO of Amicus Therapeutics, Inc. (NASDAQ:FOLD) since 2011, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Check out our latest analysis for Amicus Therapeutics
Comparing Amicus Therapeutics, Inc.'s CEO Compensation With the industry
Our data indicates that Amicus Therapeutics, Inc. has a market capitalization of US$3.5b, and total annual CEO compensation was reported as US$9.9m for the year to December 2019. Notably, that's an increase of 33% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$657k.
On comparing similar companies from the same industry with market caps ranging from US$2.0b to US$6.4b, we found that the median CEO total compensation was US$7.2m. Hence, we can conclude that John Crowley is remunerated higher than the industry median. What's more, John Crowley holds US$13m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$657k | US$638k | 7% |
Other | US$9.2m | US$6.8m | 93% |
Total Compensation | US$9.9m | US$7.4m | 100% |
Talking in terms of the industry, salary represented approximately 23% of total compensation out of all the companies we analyzed, while other remuneration made up 77% of the pie. Amicus Therapeutics sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
Amicus Therapeutics, Inc.'s Growth
Over the past three years, Amicus Therapeutics, Inc. has seen its earnings per share (EPS) grow by 7.3% per year. It achieved revenue growth of 72% over the last year.
It's great to see that revenue growth is strong. With that in mind, the modestly improving EPS seems positive. So while we'd stop short of saying growth is absolutely outstanding, there are definitely some clear positives! Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Amicus Therapeutics, Inc. Been A Good Investment?
Since shareholders would have lost about 2.2% over three years, some Amicus Therapeutics, Inc. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
As we touched on above, Amicus Therapeutics, Inc. is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. While we have not been overly impressed by the business performance, the shareholder returns have been utterly depressing, over the last three years. This doesn't look good when you see that John is earning more than the industry median. With such poor returns, we would understand if shareholders had concerns related to the CEO's pay.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Amicus Therapeutics that you should be aware of before investing.
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.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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