The CEO Of Box, Inc. (NYSE:BOX) Might See A Pay Rise On The Horizon

By
Simply Wall St
Published
September 02, 2021
NYSE:BOX
Source: Shutterstock

Shareholders will be pleased by the robust performance of Box, Inc. (NYSE:BOX) recently and this will be kept in mind in the upcoming AGM on 09 September 2021. The focus will probably be on the future strategic initiatives that the board and management will put in place to improve the business rather than executive remuneration when they cast their votes on company resolutions. Here is our take on why we think CEO compensation is fair and may even warrant a raise.

Check out our latest analysis for Box

How Does Total Compensation For Aaron Levie Compare With Other Companies In The Industry?

Our data indicates that Box, Inc. has a market capitalization of US$3.9b, and total annual CEO compensation was reported as US$288k for the year to January 2021. We note that's an increase of 24% above last year. We note that the salary portion, which stands at US$180.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$5.3m. This suggests that Aaron Levie is paid below the industry median. Furthermore, Aaron Levie directly owns US$55m worth of shares in the company, implying that they are deeply invested in the company's success.

Component20212020Proportion (2021)
Salary US$180k US$180k 62%
Other US$108k US$53k 38%
Total CompensationUS$288k US$233k100%

On an industry level, around 14% of total compensation represents salary and 86% is other remuneration. Box pays out 62% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

ceo-compensation
NYSE:BOX CEO Compensation September 3rd 2021

Box, Inc.'s Growth

Box, Inc.'s earnings per share (EPS) grew 42% per year over the last three years. It achieved revenue growth of 10% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Box, Inc. Been A Good Investment?

Box, Inc. has generated a total shareholder return of 5.7% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

To Conclude...

The company's overall performance, while not bad, could be better. 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.

If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Box.

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