Stock Analysis

Increases to CEO Compensation Might Be Put On Hold For Now at The Trade Desk, Inc. (NASDAQ:TTD)

  •  Updated
NasdaqGM:TTD
Source: Shutterstock

Performance at The Trade Desk, Inc. (NASDAQ:TTD) has been reasonably good and CEO Jeff Green has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 27 May 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Trade Desk

How Does Total Compensation For Jeff Green Compare With Other Companies In The Industry?

At the time of writing, our data shows that The Trade Desk, Inc. has a market capitalization of US$26b, and reported total annual CEO compensation of US$16m for the year to December 2020. That's a notable increase of 31% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$900k.

For comparison, other companies in the industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$9.6m. Accordingly, our analysis reveals that The Trade Desk, Inc. pays Jeff Green north of the industry median. What's more, Jeff Green holds US$2.4b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component20202019Proportion (2020)
Salary US$900k US$850k 6%
Other US$15m US$11m 94%
Total CompensationUS$16m US$12m100%

On an industry level, around 11% of total compensation represents salary and 89% is other remuneration. It's interesting to note that Trade Desk allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
NasdaqGM:TTD CEO Compensation May 22nd 2021

A Look at The Trade Desk, Inc.'s Growth Numbers

Over the past three years, The Trade Desk, Inc. has seen its earnings per share (EPS) grow by 57% per year. Its revenue is up 28% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has The Trade Desk, Inc. Been A Good Investment?

We think that the total shareholder return of 554%, over three years, would leave most The Trade Desk, 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.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for Trade Desk that investors should think about before committing capital to this stock.

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 Trade Desk 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


Valuation is complex, but we're helping make it simple.

Find out whether Trade Desk is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

View the Free Analysis