In 2011 Bradley Jacobs was appointed CEO of XPO Logistics, Inc. (NYSE:XPO). 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. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
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Check out our latest analysis for XPO Logistics
How Does Bradley Jacobs's Compensation Compare With Similar Sized Companies?
Our data indicates that XPO Logistics, Inc. is worth US$5.4b, and total annual CEO compensation is US$13m. (This number is for the twelve months until December 2018). That's a notable increase of 863% on last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$625k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12b. The median total CEO compensation was US$6.9m.
As you can see, Bradley Jacobs is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean XPO Logistics, Inc. is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at XPO Logistics has changed from year to year.
Is XPO Logistics, Inc. Growing?
On average over the last three years, XPO Logistics, Inc. has grown earnings per share (EPS) by 91% each year (using a line of best fit). In the last year, its revenue is up 7.3%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.
Has XPO Logistics, Inc. Been A Good Investment?
Boasting a total shareholder return of 125% over three years, XPO Logistics, Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
In Summary...
We compared total CEO remuneration at XPO Logistics, Inc. with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong 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 XPO Logistics (free visualization of insider trades).
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.
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 editorial-team@simplywallst.com. 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. Thank you for reading.