Bonnie Anderson became the CEO of Veracyte, Inc. (NASDAQ:VCYT) in 2008, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Veracyte.
How Does Total Compensation For Bonnie Anderson Compare With Other Companies In The Industry?
According to our data, Veracyte, Inc. has a market capitalization of US$1.8b, and paid its CEO total annual compensation worth US$4.2m over the year to December 2019. Notably, that's an increase of 47% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$580k.
In comparison with other companies in the industry with market capitalizations ranging from US$1.0b to US$3.2b, the reported median CEO total compensation was US$4.4m. From this we gather that Bonnie Anderson is paid around the median for CEOs in the industry. Furthermore, Bonnie Anderson directly owns US$13m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, around 23% of total compensation represents salary and 77% is other remuneration. In Veracyte's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at Veracyte, Inc.'s Growth Numbers
Veracyte, Inc. has seen its earnings per share (EPS) increase by 33% a year over the past three years. Its revenue is up 3.3% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Veracyte, Inc. Been A Good Investment?
Boasting a total shareholder return of 331% over three years, Veracyte, Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
As previously discussed, Bonnie is compensated close to the median for companies of its size, and which belong to the same industry. Few would be critical of the leadership, since returns have been juicy and earnings are moving in the right direction. Indeed, many might consider that Bonnie is compensated rather modestly, given the solid company performance! Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 4 warning signs for Veracyte that investors should look into moving forward.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email firstname.lastname@example.org.