Here's Why Wix.com Ltd.'s (NASDAQ:WIX) CEO Might See A Pay Rise Soon

Shareholders will be pleased by the robust performance of Wix.com Ltd. (NASDAQ:WIX) recently and this will be kept in mind in the upcoming AGM on 08 November 2021. They will probably be more interested in hearing the board discuss future initiatives to further improve the business as they vote on resolutions such as executive remuneration. In our analysis below, we discuss why we think the CEO compensation looks acceptable and the case for a raise.

Check out our latest analysis for Wix.com

How Does Total Compensation For Avishai Abrahami Compare With Other Companies In The Industry?

At the time of writing, our data shows that Wix.com Ltd. has a market capitalization of US$11b, and reported total annual CEO compensation of US$2.3m for the year to December 2020. Notably, that's a decrease of 21% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$264k.

For comparison, other companies in the industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$9.6m. That is to say, Avishai Abrahami is paid under the industry median. Moreover, Avishai Abrahami also holds US$184m worth of Wix.com stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2020	2019	Proportion (2020)
Salary	US$264k	US$359k	12%
Other	US$2.0m	US$2.5m	88%
Total Compensation	US$2.3m	US$2.9m	100%

On an industry level, around 18% of total compensation represents salary and 82% is other remuneration. In Wix.com's case, non-salary compensation represents a greater slice of total remuneration, 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.

Wix.com Ltd.'s Growth

Over the last three years, Wix.com Ltd. has shrunk its earnings per share by 48% per year. It achieved revenue growth of 36% over the last year.

Investors would be a bit wary of companies that have lower EPS But on the other hand, revenue growth is strong, suggesting a brighter future. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Wix.com Ltd. Been A Good Investment?

We think that the total shareholder return of 95%, over three years, would leave most Wix.com Ltd. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Overall, the company hasn't done too poorly performance-wise, but we would like to see some improvement. If it manages to keep up the current streak, CEO remuneration could well be one of shareholders' least concerns. Rather, investors would more likely want to engage on discussions related to key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 4 warning signs (and 1 which doesn't sit too well with us) in Wix.com we think you should know about.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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