Michael Morrissey became the CEO of Exelixis, Inc. (NASDAQ:EXEL) in 2010. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. 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 Michael Morrissey’s Compensation Compare With Similar Sized Companies?
According to our data, Exelixis, Inc. has a market capitalization of US$6.4b, and pays its CEO total annual compensation worth US$8.0m. (This figure is for the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$945k. 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$6.9m.
So Michael Morrissey receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at Exelixis has changed over time.
Is Exelixis, Inc. Growing?
Exelixis, Inc. has increased its earnings per share (EPS) by an average of 118% a year, over the last three years (using a line of best fit). It achieved revenue growth of 46% over the last year.
This demonstrates that the company has been improving recently. A good result. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see.
Has Exelixis, Inc. Been A Good Investment?
I think that the total shareholder return of 144%, over three years, would leave most Exelixis, Inc. shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
Michael Morrissey is paid around what is normal the leaders of comparable size companies.
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Exelixis.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
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. Thank you for reading.