In 2009 Kevin Conroy was appointed CEO of Exact Sciences Corporation (NASDAQ:EXAS). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Kevin Conroy's Compensation Compare With Similar Sized Companies?
According to our data, Exact Sciences Corporation has a market capitalization of US$7.6b, and paid its CEO total annual compensation worth US$7.0m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$696k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We looked at a group of companies with market capitalizations from US$4.0b to US$12b, and the median CEO total compensation was US$7.6m.
Now let's take a look at the pay mix on an industry and company level to gain a better understanding of where Exact Sciences stands. On an industry level, roughly 22% of total compensation represents salary and 78% is other remuneration. Non-salary compensation represents a greater slice of the remuneration pie for Exact Sciences, in sharp contrast to the overall sector.
So Kevin Conroy receives a similar amount to the median CEO pay, amongst the companies we looked at. 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. You can see a visual representation of the CEO compensation at Exact Sciences, below.
Is Exact Sciences Corporation Growing?
Exact Sciences Corporation saw earnings per share stay pretty flat over the last three years, albeit with a slight decrease, according to the line of best fit. Its revenue is up 93% over last year.
Investors should note that, over three years, earnings per share are down. On the other hand, the strong revenue growth suggests the business is growing. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. It could be important to check this free visual depiction of what analysts expect for the future.
Has Exact Sciences Corporation Been A Good Investment?
Boasting a total shareholder return of 145% over three years, Exact Sciences Corporation has done well by shareholders. 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.
Kevin Conroy is paid around what is normal for the leaders of comparable size companies.
The company isn't showing particularly great growth, but shareholder returns have been pleasing. So all things considered I'd venture that the CEO pay is appropriate. Moving away from CEO compensation for the moment, we've identified 2 warning signs for Exact Sciences that you should be aware of before investing.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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