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Is Indivior PLC (LON:INDV) Overpaying Its CEO?

Simply Wall St

In 2014 Shaun Thaxter was appointed CEO of Indivior PLC (LON:INDV). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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 method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Indivior

How Does Shaun Thaxter's Compensation Compare With Similar Sized Companies?

Our data indicates that Indivior PLC is worth UK£379m, and total annual CEO compensation was reported as US$1.0m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$798k. We looked at a group of companies with market capitalizations from US$200m to US$800m, and the median CEO total compensation was US$875k.

So Shaun Thaxter is paid around the average of 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 Indivior, below.

LSE:INDV CEO Compensation, October 21st 2019

Is Indivior PLC Growing?

On average over the last three years, Indivior PLC has grown earnings per share (EPS) by 40% each year (using a line of best fit). In the last year, its revenue is down 12%.

This shows that the company has improved itself over the last few years. Good news for shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Shareholders might be interested in this free visualization of analyst forecasts.

Has Indivior PLC Been A Good Investment?

Given the total loss of 83% over three years, many shareholders in Indivior PLC are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

Shaun Thaxter is paid around the same as most CEOs of similar size companies.

We think that the EPS growth is very pleasing, but we cannot say the same about the lacklustre shareholder returns (over the last three years). We'd be surprised if shareholders want to see a pay rise for the CEO, but we'd stop short of calling their pay too generous. Whatever your view on compensation, you might want to check if insiders are buying or selling Indivior shares (free trial).

If you want to buy a stock that is better than Indivior, this free list of high return, low debt companies is a great place to look.

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.