Stuart Peltz became the CEO of PTC Therapeutics, Inc. (NASDAQ:PTCT) in 1998. First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Stuart Peltz’s Compensation Compare With Similar Sized Companies?
According to our data, PTC Therapeutics, Inc. has a market capitalization of US$1.7b, and pays its CEO total annual compensation worth US$2.2m. (This number is for the twelve months until 2017). While we always look at total compensation first, we note that the salary component is less, at US$637k. We examined companies with market caps from US$1.0b to US$3.2b, and discovered that the median CEO compensation of that group was US$3.6m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see a visual representation of the CEO compensation at Therapeutics, below.
Is PTC Therapeutics, Inc. Growing?
On average over the last three years, PTC Therapeutics, Inc. has grown earnings per share (EPS) by 39% each year. Its revenue is up 81% over last year.
This demonstrates that the company has been improving recently. A good result. It’s great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly.
It could be important to check this free visual depiction of what analysts expect for the future.
Has PTC Therapeutics, Inc. Been A Good Investment?
With a total shareholder return of 7.3% over three years, PTC Therapeutics, Inc. has done okay by shareholders. But they would probably prefer not to see CEO compensation far in excess of the median.
PTC Therapeutics, Inc. is currently paying its CEO below what is normal for companies of its size. Since the business is growing, many would argue this suggests the pay is modest. While some might be keen on seeing higher returns, our short analysis has not produced any evidence to suggest Stuart Peltz is overcompensated.
It’s great to see a company that pays its CEO reasonably, even while growing. It would be an additional positive if insiders are buying shares. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Therapeutics.
Or you might prefer this data-rich interactive visualization of historic revenue and earnings.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.