What Can We Conclude About Citrix Systems' (NASDAQ:CTXS) CEO Pay?

David Henshall has been the CEO of Citrix Systems, Inc. (NASDAQ:CTXS) since 2017, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Citrix Systems pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Citrix Systems

How Does Total Compensation For David Henshall Compare With Other Companies In The Industry?

Our data indicates that Citrix Systems, Inc. has a market capitalization of US$16b, and total annual CEO compensation was reported as US$15m for the year to December 2019. Notably, that's a decrease of 25% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.0m.

For comparison, other companies in the industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$9.7m. Accordingly, our analysis reveals that Citrix Systems, Inc. pays David Henshall north of the industry median. Moreover, David Henshall also holds US$41m worth of Citrix Systems stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 13% of total compensation represents salary, while the remainder of 87% is other remuneration. Citrix Systems pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Citrix Systems, Inc.'s Growth Numbers

Citrix Systems, Inc. has seen its earnings per share (EPS) increase by 15% a year over the past three years. In the last year, its revenue is up 7.8%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. 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 Citrix Systems, Inc. Been A Good Investment?

We think that the total shareholder return of 54%, over three years, would leave most Citrix Systems, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

As previously discussed, David is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Importantly though, EPS growth and shareholder returns are very impressive over the last three years. Considering such exceptional results for the company, we'd venture to say CEO compensation is fair. Given the strong history of shareholder returns, the shareholders are probably very happy with David's performance.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Citrix Systems that investors should think about before committing capital to this stock.

Switching gears from Citrix Systems, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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