In 2012 Joshua Levine was appointed CEO of Accuray Incorporated (NASDAQ:ARAY). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Joshua Levine's Compensation Compare With Similar Sized Companies?
According to our data, Accuray Incorporated has a market capitalization of US$305m, and pays its CEO total annual compensation worth US$3.4m. (This is based on the year to June 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$710k. We examined companies with market caps from US$200m to US$800m, and discovered that the median CEO total compensation of that group was US$1.8m.
As you can see, Joshua Levine is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Accuray Incorporated 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.
You can see a visual representation of the CEO compensation at Accuray, below.
Is Accuray Incorporated Growing?
Accuray Incorporated has increased its earnings per share (EPS) by an average of 8.5% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 3.0%.
I would argue that the improvement in revenue isn't particularly impressive, but I'm happy with the modest EPS growth. So there are some positives here, but not enough to earn high praise. It could be important to check this free visual depiction of what analysts expect for the future.
Has Accuray Incorporated Been A Good Investment?
Given the total loss of 40% over three years, many shareholders in Accuray Incorporated are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by Accuray Incorporated, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. Whatever your view on compensation, you might want to check if insiders are buying or selling Accuray shares (free trial).
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.
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