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We have been pretty impressed with the performance at ExlService Holdings, Inc. (NASDAQ:EXLS) recently and CEO Rohit Kapoor deserves a mention for their role in it. Coming up to the next AGM on 16 June 2021, shareholders would be keeping this in mind. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.
How Does Total Compensation For Rohit Kapoor Compare With Other Companies In The Industry?
According to our data, ExlService Holdings, Inc. has a market capitalization of US$3.5b, and paid its CEO total annual compensation worth US$7.1m over the year to December 2020. Notably, that's an increase of 15% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$599k.
On examining similar-sized companies in the industry with market capitalizations between US$2.0b and US$6.4b, we discovered that the median CEO total compensation of that group was US$5.6m. So it looks like ExlService Holdings compensates Rohit Kapoor in line with the median for the industry. Moreover, Rohit Kapoor also holds US$74m worth of ExlService Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Talking in terms of the industry, salary represented approximately 14% of total compensation out of all the companies we analyzed, while other remuneration made up 86% of the pie. ExlService Holdings sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
ExlService Holdings, Inc.'s Growth
ExlService Holdings, Inc.'s earnings per share (EPS) grew 21% per year over the last three years. It saw its revenue drop 2.4% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has ExlService Holdings, Inc. Been A Good Investment?
Most shareholders would probably be pleased with ExlService Holdings, Inc. for providing a total return of 76% 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.
Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for ExlService Holdings that investors should think about before committing capital to this stock.
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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