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What We Learned About Athenex's (NASDAQ:ATNX) CEO Pay

Simply Wall St
·3 min read

This article will reflect on the compensation paid to Johnson Lau who has served as CEO of Athenex, Inc. (NASDAQ:ATNX) since 2011. This analysis will also assess whether Athenex pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Athenex

Comparing Athenex, Inc.'s CEO Compensation With the industry

According to our data, Athenex, Inc. has a market capitalization of US$1.2b, and paid its CEO total annual compensation worth US$4.5m over the year to December 2019. We note that's an increase of 36% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$519k.

For comparison, other companies in the same industry with market capitalizations ranging between US$400m and US$1.6b had a median total CEO compensation of US$2.5m. Accordingly, our analysis reveals that Athenex, Inc. pays Johnson Lau north of the industry median. Furthermore, Johnson Lau directly owns US$42m worth of shares in the company, implying that they are deeply invested in the company's success.

Component

2019

2018

Proportion (2019)

Salary

US$519k

US$500k

12%

Other

US$4.0m

US$2.8m

88%

Total Compensation

US$4.5m

US$3.3m

100%

Talking in terms of the industry, salary represented approximately 23% of total compensation out of all the companies we analyzed, while other remuneration made up 77% of the pie. Athenex sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
ceo-compensation

Athenex, Inc.'s Growth

Athenex, Inc.'s earnings per share (EPS) grew 25% per year over the last three years. It achieved revenue growth of 61% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Athenex, Inc. Been A Good Investment?

Given the total shareholder loss of 34% over three years, many shareholders in Athenex, Inc. are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As we touched on above, Athenex, Inc. is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, we must not forget that the EPS growth has been very strong, but it's disappointing to see negative shareholder returns over the same period. Although we'd stop short of calling it inappropriate, we think Johnson is earning a very handsome sum.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 2 warning signs (and 1 which doesn't sit too well with us) in Athenex we think you should know about.

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.

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