Want to participate in a short research study? Help shape the future of investing tools and earn a $40 gift card!
Andrew Anagnost became the CEO of Autodesk, Inc. (NASDAQ:ADSK) in 2017, 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 Autodesk.
How Does Total Compensation For Andrew Anagnost Compare With Other Companies In The Industry?
Our data indicates that Autodesk, Inc. has a market capitalization of US$54b, and total annual CEO compensation was reported as US$12m for the year to January 2020. That's a notable increase of 28% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$904k.
In comparison with other companies in the industry with market capitalizations over US$8.0b , the reported median total CEO compensation was US$9.8m. This suggests that Autodesk remunerates its CEO largely in line with the industry average. Furthermore, Andrew Anagnost directly owns US$13m worth of shares in the company, implying that they are deeply invested in the company's success.
Talking in terms of the industry, salary represented approximately 12% of total compensation out of all the companies we analyzed, while other remuneration made up 88% of the pie. Autodesk sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
Autodesk, Inc.'s Growth
Autodesk, Inc. has seen its earnings per share (EPS) increase by 100% a year over the past three years. In the last year, its revenue is up 25%.
Shareholders would be glad to know that the company has improved itself over the last few years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Autodesk, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Autodesk, Inc. for providing a total return of 128% over three years. 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, Andrew 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. So one could argue that CEO compensation is quite modest, if you consider company performance! Stockholders might even be okay with a bump in pay, seeing as how investor returns have been so strong.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Autodesk that investors should think about before committing capital to this stock.
Important note: Autodesk is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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.