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Is Jazz Pharmaceuticals plc's (NASDAQ:JAZZ) CEO Paid At A Competitive Rate?

Simply Wall St

Bruce Cozadd became the CEO of Jazz Pharmaceuticals plc (NASDAQ:JAZZ) in 2009. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. 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.

View our latest analysis for Jazz Pharmaceuticals

How Does Bruce Cozadd's Compensation Compare With Similar Sized Companies?

According to our data, Jazz Pharmaceuticals plc has a market capitalization of US$7.8b, and paid its CEO total annual compensation worth US$11m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$979k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We examined companies with market caps from US$4.0b to US$12b, and discovered that the median CEO total compensation of that group was US$6.8m.

It would therefore appear that Jazz Pharmaceuticals plc pays Bruce Cozadd more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

The graphic below shows how CEO compensation at Jazz Pharmaceuticals has changed from year to year.

NasdaqGS:JAZZ CEO Compensation, November 19th 2019

Is Jazz Pharmaceuticals plc Growing?

On average over the last three years, Jazz Pharmaceuticals plc has grown earnings per share (EPS) by 18% each year (using a line of best fit). Its revenue is up 11% over last year.

This demonstrates that the company has been improving recently. A good result. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. You might want to check this free visual report on analyst forecasts for future earnings.

Has Jazz Pharmaceuticals plc Been A Good Investment?

Jazz Pharmaceuticals plc has generated a total shareholder return of 27% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

We examined the amount Jazz Pharmaceuticals plc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

However, the earnings per share growth over three years is certainly impressive. We also think investors are doing ok, over the same time period. While it may be worth researching further, we don't see a problem with the CEO pay, given the good EPS growth. Whatever your view on compensation, you might want to check if insiders are buying or selling Jazz Pharmaceuticals shares (free trial).

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.