Rick Winningham became the CEO of Theravance Biopharma, Inc. (NASDAQ:TBPH) in 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Rick Winningham's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Theravance Biopharma, Inc. has a market cap of US$1.9b, and reported total annual CEO compensation of US$5.9m for the year to December 2019. That's a notable increase of 135% on last year. We think total compensation is more important but we note that the CEO salary is lower, at US$984k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We examined companies with market caps from US$1.0b to US$3.2b, and discovered that the median CEO total compensation of that group was US$4.8m.
Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Theravance Biopharma. Speaking on an industry level, we can see that nearly 30% of total compensation represents salary, while the remainder of 70% is other remuneration. Theravance Biopharma sets aside a smaller share of compensation for salary, in comparison to the overall industry.
So Rick Winningham receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance. You can see a visual representation of the CEO compensation at Theravance Biopharma, below.
Is Theravance Biopharma, Inc. Growing?
On average over the last three years, Theravance Biopharma, Inc. has seen earnings per share (EPS) move in a favourable direction by 5.6% each year (using a line of best fit). It achieved revenue growth of 22% over the last year.
I think the revenue growth is good. And the improvement in earnings per share is modest but respectable. So while performance isn't amazing, we think it really does seem quite respectable. You might want to check this free visual report on analyst forecasts for future earnings.
Has Theravance Biopharma, Inc. Been A Good Investment?
Since shareholders would have lost about 26% over three years, some Theravance Biopharma, Inc. shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
Remuneration for Rick Winningham is close enough to the median pay for a CEO of a similar sized company .
The company cannot boast particularly strong per share growth. And shareholder returns have been disappointing over the last three years. Shareholders might not feel great about the fact that CEO pay increased on last year. So many would argue that the CEO is certainly not underpaid. Shifting gears from CEO pay for a second, we've picked out 3 warning signs for Theravance Biopharma that investors should be aware of in a dynamic business environment.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
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. Thank you for reading.