Is Applied Genetic Technologies Corporation (NASDAQ:AGTC) Overpaying Its CEO?

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Sue Washer became the CEO of Applied Genetic Technologies Corporation (NASDAQ:AGTC) in 2002. 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.

View our latest analysis for Applied Genetic Technologies

How Does Sue Washer’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Applied Genetic Technologies Corporation has a market cap of US$60m, and is paying total annual CEO compensation of US$1.1m. (This is based on the year to 2018). While we always look at total compensation first, we note that the salary component is less, at US$502k. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO compensation to be US$300k.

As you can see, Sue Washer is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Applied Genetic Technologies Corporation is paying too much. 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 Applied Genetic Technologies has changed from year to year.

NASDAQGM:AGTC CEO Compensation February 12th 19
NASDAQGM:AGTC CEO Compensation February 12th 19

Is Applied Genetic Technologies Corporation Growing?

On average over the last three years, Applied Genetic Technologies Corporation has shrunk earnings per share by 42% each year (measured with a line of best fit). Its revenue is down -9.1% over last year.

Unfortunately, earnings per share have trended lower over the last three years. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.

Has Applied Genetic Technologies Corporation Been A Good Investment?

With a three year total loss of 76%, Applied Genetic Technologies Corporation would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary…

We compared total CEO remuneration at Applied Genetic Technologies Corporation 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.

We think many shareholders would be underwhelmed with the business growth over the last three years.

Arguably worse, investors are without a positive return for the last three years. This analysis suggests to us that the CEO is paid too generously! So you may want to check if insiders are buying Applied Genetic Technologies shares with their own money (free access).

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

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.