Bradley Jacobs has been the CEO of XPO Logistics, Inc. (NYSE:XPO) since 2011. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Bradley Jacobs's Compensation Compare With Similar Sized Companies?
According to our data, XPO Logistics, Inc. has a market capitalization of US$7.6b, and paid its CEO total annual compensation worth US$13m over the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$625k. 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 selection of companies with market caps ranging from US$4.0b to US$12b, we found the median CEO total compensation was US$6.4m.
It would therefore appear that XPO Logistics, Inc. pays Bradley Jacobs more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at XPO Logistics has changed over time.
Is XPO Logistics, Inc. Growing?
XPO Logistics, Inc. has increased its earnings per share (EPS) by an average of 53% a year, over the last three years (using a line of best fit). Its revenue is down 1.1% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. You might want to check this free visual report on analyst forecasts for future earnings.
Has XPO Logistics, Inc. Been A Good Investment?
Most shareholders would probably be pleased with XPO Logistics, Inc. for providing a total return of 87% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
We compared total CEO remuneration at XPO Logistics, Inc. with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong over three years. In addition, shareholders have done well over the same time period. So, considering this good performance, the CEO compensation may be quite appropriate. So you may want to check if insiders are buying XPO Logistics shares with their own money (free access).
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 firstname.lastname@example.org. 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.