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Mihael Polymeropoulos became the CEO of Vanda Pharmaceuticals Inc. (NASDAQ:VNDA) in 2003. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Mihael Polymeropoulos’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Vanda Pharmaceuticals Inc. has a market cap of US$1.1b, and is paying total annual CEO compensation of US$3.8m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$675k. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO compensation of that group was US$2.2m.
Thus we can conclude that Mihael Polymeropoulos receives more in total compensation than the median of a group of companies in the same market, and of similar size to Vanda Pharmaceuticals Inc.. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Vanda Pharmaceuticals, below.
Is Vanda Pharmaceuticals Inc. Growing?
Over the last three years Vanda Pharmaceuticals Inc. has grown its earnings per share (EPS) by an average of 97% per year (using a line of best fit). Its revenue is up 17% over last year.
This demonstrates that the company has been improving recently. A good result. It’s a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Vanda Pharmaceuticals Inc. Been A Good Investment?
I think that the total shareholder return of 163%, over three years, would leave most Vanda Pharmaceuticals Inc. shareholders smiling. 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 examined the amount Vanda 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.
Importantly, though, the company has impressed with its earnings per share growth, over three years. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Vanda Pharmaceuticals (free visualization of insider trades).
If you want to buy a stock that is better than Vanda Pharmaceuticals, this free list of high return, low debt companies is a great place to look.
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 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. On rare occasion, data errors may occur. Thank you for reading.