Most Shareholders Will Probably Find That The CEO Compensation For Blueprint Medicines Corporation (NASDAQ:BPMC) Is Reasonable

By
Simply Wall St
Published
May 26, 2021
NasdaqGS:BPMC
Source: Shutterstock

CEO Jeff Albers has done a decent job of delivering relatively good performance at Blueprint Medicines Corporation (NASDAQ:BPMC) recently. As shareholders go into the upcoming AGM on 02 June 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. Here is our take on why we think the CEO compensation looks appropriate.

Check out our latest analysis for Blueprint Medicines

Comparing Blueprint Medicines Corporation's CEO Compensation With the industry

Our data indicates that Blueprint Medicines Corporation has a market capitalization of US$5.6b, and total annual CEO compensation was reported as US$6.3m for the year to December 2020. That's a notable decrease of 32% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$645k.

On examining similar-sized companies in the industry with market capitalizations between US$4.0b and US$12b, we discovered that the median CEO total compensation of that group was US$6.3m. So it looks like Blueprint Medicines compensates Jeff Albers in line with the median for the industry. Moreover, Jeff Albers also holds US$8.1m worth of Blueprint Medicines stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component20202019Proportion (2020)
Salary US$645k US$590k 10%
Other US$5.7m US$8.8m 90%
Total CompensationUS$6.3m US$9.4m100%

Speaking on an industry level, nearly 20% of total compensation represents salary, while the remainder of 80% is other remuneration. Blueprint Medicines sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ceo-compensation
NasdaqGS:BPMC CEO Compensation May 27th 2021

Blueprint Medicines Corporation's Growth

Over the past three years, Blueprint Medicines Corporation has seen its earnings per share (EPS) grow by 52% per year. It achieved revenue growth of 1,025% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Blueprint Medicines Corporation Been A Good Investment?

Blueprint Medicines Corporation has served shareholders reasonably well, with a total return of 15% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 2 warning signs for Blueprint Medicines that investors should look into moving forward.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

When trading Blueprint Medicines or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted


Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.