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Roger Tung has been the CEO of Concert Pharmaceuticals, Inc. (NASDAQ:CNCE) since 2006. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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 method should give us information to assess how appropriately the company pays the CEO.
How Does Roger Tung’s Compensation Compare With Similar Sized Companies?
According to our data, Concert Pharmaceuticals, Inc. has a market capitalization of US$290m, and pays its CEO total annual compensation worth US$4.6m. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$536k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$100m to US$400m. The median total CEO compensation was US$1.1m.
It would therefore appear that Concert Pharmaceuticals, Inc. pays Roger Tung 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 a visual representation of the CEO compensation at Concert Pharmaceuticals, below.
Is Concert Pharmaceuticals, Inc. Growing?
Concert Pharmaceuticals, Inc. has increased its earnings per share (EPS) by an average of 9.7% a year, over the last three years (using a line of best fit). It saw its revenue drop -90% over the last year.
I would argue that the lack of revenue growth in the last year is less than ideal, but I’m happy with the EPS growth. It’s hard to reach a conclusion about business performance right now. This may be one to watch.
Has Concert Pharmaceuticals, Inc. Been A Good Investment?
Concert Pharmaceuticals, Inc. has generated a total shareholder return of 1.9% over three years, so most shareholders wouldn’t be too disappointed. But they probably don’t want to see the CEO paid more than is normal for companies around the same size.
We examined the amount Concert Pharmaceuticals, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. Considering this, we wouldn’t want to see any big pay rises, although we’d stop short of calling the CEO compensation unfair. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Concert Pharmaceuticals.
Important note: Concert Pharmaceuticals may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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.