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In 2007 Greg Garrabrants was appointed CEO of Axos Financial, Inc. (NYSE:AX). First, this article will compare CEO compensation with compensation at similar sized companies. 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.
How Does Greg Garrabrants's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Axos Financial, Inc. has a market cap of US$1.6b, and is paying total annual CEO compensation of US$27m. (This is based on the year to June 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$700k. 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.
Thus we can conclude that Greg Garrabrants receives more in total compensation than the median of a group of companies in the same market, and of similar size to Axos Financial, Inc.. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Axos Financial has changed over time.
Is Axos Financial, Inc. Growing?
Over the last three years Axos Financial, Inc. has grown its earnings per share (EPS) by an average of 12% per year (using a line of best fit). In the last year, its revenue is up 9.4%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Shareholders might be interested in this free visualization of analyst forecasts.
Has Axos Financial, Inc. Been A Good Investment?
Boasting a total shareholder return of 60% over three years, Axos Financial, Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
We compared total CEO remuneration at Axos Financial, Inc. with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong over three years. On top of that, in the same period, returns to shareholders have been great. So, considering this good performance, the CEO compensation may be quite appropriate. Shareholders may want to check for free if Axos Financial insiders are buying or selling shares.
If you want to buy a stock that is better than Axos Financial, this free list of high return, low debt companies is a great place to look.
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 email@example.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.