Does Boston Properties, Inc.'s (NYSE:BXP) CEO Pay Matter?
Owen Thomas has been the CEO of Boston Properties, Inc. (NYSE:BXP) since 2013. First, this article will compare CEO compensation with compensation at other large 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. This process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for Boston Properties
How Does Owen Thomas's Compensation Compare With Similar Sized Companies?
According to our data, Boston Properties, Inc. has a market capitalization of US$23b, and paid its CEO total annual compensation worth US$12m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$875k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO total compensation was US$11m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
So Owen Thomas receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at Boston Properties, below.
Is Boston Properties, Inc. Growing?
On average over the last three years, Boston Properties, Inc. has grown earnings per share (EPS) by 4.6% each year (using a line of best fit). It achieved revenue growth of 9.5% over the last year.
I would argue that the improvement in revenue isn't particularly impressive, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. You might want to check this free visual report on analyst forecasts for future earnings.
Has Boston Properties, Inc. Been A Good Investment?
With a total shareholder return of 19% over three years, Boston Properties, Inc. shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
In Summary...
Remuneration for Owen Thomas is close enough to the median pay for a CEO of a large company .
We see room for improved growth, as well as fairly unremarkable returns over the last three years. But we don't think the CEO compensation is a problem. Whatever your view on compensation, you might want to check if insiders are buying or selling Boston Properties 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.
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.
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