Yahoo Finance We Think Some Shareholders May Hesitate To Increase 10x Genomics, Inc.'s (NASDAQ:TXG) CEO Compensation
Key Insights
10x Genomics to hold its Annual General Meeting on 11th of June
Total pay for CEO Serge Saxonov includes US$544.7k salary
Total compensation is similar to the industry average
10x Genomics' EPS grew by 34% over the past three years while total shareholder loss over the past three years was 89%
The underwhelming share price performance of 10x Genomics, Inc. (NASDAQ:TXG) in the past three years would have disappointed many shareholders. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 11th of June. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.
Check out our latest analysis for 10x Genomics
How Does Total Compensation For Serge Saxonov Compare With Other Companies In The Industry?
Our data indicates that 10x Genomics, Inc. has a market capitalization of US$2.7b, and total annual CEO compensation was reported as US$8.3m for the year to December 2023. Notably, that's a decrease of 56% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$545k.
On comparing similar companies from the American Life Sciences industry with market caps ranging from US$2.0b to US$6.4b, we found that the median CEO total compensation was US$6.9m. This suggests that 10x Genomics remunerates its CEO largely in line with the industry average. Moreover, Serge Saxonov also holds US$86m worth of 10x Genomics stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$545k | US$504k | 7% |
Other | US$7.7m | US$18m | 93% |
Total Compensation | US$8.3m | US$19m | 100% |
On an industry level, around 19% of total compensation represents salary and 81% is other remuneration. 10x Genomics sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
10x Genomics, Inc.'s Growth
Over the past three years, 10x Genomics, Inc. has seen its earnings per share (EPS) grow by 34% per year. In the last year, its revenue is up 17%.
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. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has 10x Genomics, Inc. Been A Good Investment?
Few 10x Genomics, Inc. shareholders would feel satisfied with the return of -89% over three years. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 3 warning signs for 10x Genomics that investors should be aware of in a dynamic business environment.
Important note: 10x Genomics is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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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.
