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Is Illumina, Inc.'s (NASDAQ:ILMN) CEO Overpaid Relative To Its Peers?

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Francis deSouza has been the CEO of Illumina, Inc. (NASDAQ:ILMN) since 2016. First, this article will compare CEO compensation with compensation at other large companies. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Illumina

How Does Francis deSouza's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Illumina, Inc. has a market cap of US$46b, and is paying total annual CEO compensation of US$11m. (This figure is for the year to December 2018). We note that's an increase of 26% above last year. We think total compensation is more important but we note that the CEO salary is lower, at US$938k. When we examined a group of companies with market caps over US$8.0b, we found that their median CEO total compensation was US$11m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).

So Francis deSouza 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 Illumina, below.

NasdaqGS:ILMN CEO Compensation, May 14th 2019

Is Illumina, Inc. Growing?

Over the last three years Illumina, Inc. has grown its earnings per share (EPS) by an average of 20% per year (using a line of best fit). It achieved revenue growth of 16% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Shareholders might be interested in this free visualization of analyst forecasts.

Has Illumina, Inc. Been A Good Investment?

Boasting a total shareholder return of 114% over three years, Illumina, Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Remuneration for Francis deSouza is close enough to the median pay for a CEO of a large company .

The company is growing earnings per share and total shareholder returns have been pleasing. Indeed, many might consider the pay rather modest, given the solid company performance! Shareholders may want to check for free if Illumina insiders are buying or selling shares.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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 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. Thank you for reading.