Should You Worry About Vanda Pharmaceuticals Inc.’s (NASDAQ:VNDA) CEO Salary Level?
Mihael Polymeropoulos became the CEO of Vanda Pharmaceuticals Inc. (NASDAQ:VNDA) in 2003. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Vanda Pharmaceuticals
How Does Mihael Polymeropoulos’s Compensation Compare With Similar Sized Companies?
Our data indicates that Vanda Pharmaceuticals Inc. is worth US$1.6b, and total annual CEO compensation is US$3.8m. (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$675k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$1.0b to US$3.2b. The median total CEO compensation was US$3.5m.
That means Mihael Polymeropoulos receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at Vanda Pharmaceuticals, below.
Is Vanda Pharmaceuticals Inc. Growing?
On average over the last three years, Vanda Pharmaceuticals Inc. has grown earnings per share (EPS) by 27% each year (using a line of best fit). In the last year, its revenue is up 16%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Vanda Pharmaceuticals Inc. Been A Good Investment?
Boasting a total shareholder return of 241% over three years, Vanda Pharmaceuticals Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary…
Mihael Polymeropoulos is paid around the same as most CEOs of similar size companies.
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Indeed, many might consider the pay rather modest, given the solid company performance! So you may want to check if insiders are buying Vanda Pharmaceuticals shares with their own money (free access).
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 editorial-team@simplywallst.com.
