How Much Does Roku's (NASDAQ:ROKU) CEO Make?
Anthony Wood has been the CEO of Roku, Inc. (NASDAQ:ROKU) since 2002, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Roku pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Check out our latest analysis for Roku
Comparing Roku, Inc.'s CEO Compensation With the industry
Our data indicates that Roku, Inc. has a market capitalization of US$30b, and total annual CEO compensation was reported as US$13m for the year to December 2019. Notably, that's an increase of 52% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.2m.
In comparison with other companies in the industry with market capitalizations over US$8.0b , the reported median total CEO compensation was US$14m. This suggests that Roku remunerates its CEO largely in line with the industry average. What's more, Anthony Wood holds US$4.2b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$1.2m | US$1.1m | 9% |
Other | US$11m | US$7.3m | 91% |
Total Compensation | US$13m | US$8.3m | 100% |
On an industry level, around 19% of total compensation represents salary and 81% is other remuneration. Roku 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.
Roku, Inc.'s Growth
Roku, Inc. has seen its earnings per share (EPS) increase by 111% a year over the past three years. Its revenue is up 49% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Roku, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Roku, Inc. for providing a total return of 982% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
To Conclude...
As previously discussed, Anthony is compensated close to the median for companies of its size, and which belong to the same industry. The company is growing EPS and total shareholder returns have been pleasing. So one could argue that CEO compensation is quite modest, if you consider company performance! Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 3 warning signs for Roku that you should be aware of before investing.
Switching gears from Roku, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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