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In 2014 James Noble was appointed CEO of Adaptimmune Therapeutics plc (NASDAQ:ADAP). 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does James Noble's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Adaptimmune Therapeutics plc has a market cap of US$351m, and is paying total annual CEO compensation of US$2.6m. (This is based on the year to December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$536k. We examined companies with market caps from US$200m to US$800m, and discovered that the median CEO total compensation of that group was US$1.8m.
Thus we can conclude that James Noble receives more in total compensation than the median of a group of companies in the same market, and of similar size to Adaptimmune Therapeutics plc. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Adaptimmune Therapeutics, below.
Is Adaptimmune Therapeutics plc Growing?
Earnings per share at Adaptimmune Therapeutics plc are much the same as they were three years ago, albeit slightly lower, based on the trend. In the last year, its revenue is up 19%.
The lack of earnings per share growth in the last three years is unimpressive. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.
Has Adaptimmune Therapeutics plc Been A Good Investment?
Since shareholders would have lost about 56% over three years, some Adaptimmune Therapeutics plc shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by Adaptimmune Therapeutics plc, and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
Earnings per share have not grown in three years, and the revenue growth fails to impress us.
Over the same period, investors would have come away with nothing in the way of share price gains. Some might well form the view that the CEO is paid too generously! So you may want to check if insiders are buying Adaptimmune Therapeutics shares with their own money (free access).
Important note: Adaptimmune Therapeutics may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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 firstname.lastname@example.org. 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.