Marty Mucci became the CEO of Paychex, Inc. (NASDAQ:PAYX) in 2010. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. Then we'll look at a snap shot of the business growth. 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.
How Does Marty Mucci's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Paychex, Inc. has a market cap of US$30b, and reported total annual CEO compensation of US$7.9m for the year to May 2019. While we always look at total compensation first, we note that the salary component is less, at US$950k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. When we examined a group of companies with market caps over US$8.0b, we found that their median CEO total compensation was US$11m. There aren't very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
So Marty Mucci receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at Paychex has changed over time.
Is Paychex, Inc. Growing?
Over the last three years Paychex, Inc. has grown its earnings per share (EPS) by an average of 12% per year (using a line of best fit). It achieved revenue growth of 13% over the last year.
This demonstrates that the company has been improving recently. A good result. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has Paychex, Inc. Been A Good Investment?
I think that the total shareholder return of 53%, over three years, would leave most Paychex, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Remuneration for Marty Mucci is close enough to the median pay for a CEO of a large company .
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. Shareholders may want to check for free if Paychex insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
If you spot an error that warrants correction, please contact the editor at email@example.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.
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. Thank you for reading.