Clay Siegall became the CEO of Seattle Genetics, Inc. (NASDAQ:SGEN) in 2002. First, this article will compare CEO compensation with compensation at other large companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Clay Siegall's Compensation Compare With Similar Sized Companies?
According to our data, Seattle Genetics, Inc. has a market capitalization of US$18b, and paid its CEO total annual compensation worth US$18m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$919k. 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. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
Thus we can conclude that Clay Siegall receives more in total compensation than the median of a group of large companies in the same market as Seattle Genetics, Inc.. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Seattle Genetics has changed from year to year.
Is Seattle Genetics, Inc. Growing?
On average over the last three years, Seattle Genetics, Inc. has shrunk earnings per share by 16% each year (measured with a line of best fit). In the last year, its revenue is up 31%.
Investors should note that, over three years, earnings per share are down. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. You might want to check this free visual report on analyst forecasts for future earnings.
Has Seattle Genetics, Inc. Been A Good Investment?
I think that the total shareholder return of 81%, over three years, would leave most Seattle Genetics, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
We examined the amount Seattle Genetics, Inc. pays its CEO, and compared it to the amount paid by other large companies. As discussed above, we discovered that the company pays more than the median of that group.
Over the last three years returns to investors have been great, though we might have liked stronger business growth. Considering this fine result for investors, we daresay the CEO compensation might be apt. Shareholders may want to check for free if Seattle Genetics insiders are buying or selling shares.
If you want to buy a stock that is better than Seattle Genetics, this free list of high return, low debt companies is a great place to look.
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.