Yahoo Finance Does Genpact's (NYSE:G) CEO Salary Compare Well With Industry Peers?
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Tiger Tyagarajan became the CEO of Genpact Limited (NYSE:G) in 2011, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Genpact pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
See our latest analysis for Genpact
Comparing Genpact Limited's CEO Compensation With the industry
Our data indicates that Genpact Limited has a market capitalization of US$7.3b, and total annual CEO compensation was reported as US$7.6m for the year to December 2019. That's a notable decrease of 66% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$750k.
In comparison with other companies in the industry with market capitalizations ranging from US$4.0b to US$12b, the reported median CEO total compensation was US$7.6m. This suggests that Genpact remunerates its CEO largely in line with the industry average. Moreover, Tiger Tyagarajan also holds US$11m worth of Genpact stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$750k | US$700k | 10% |
Other | US$6.9m | US$22m | 90% |
Total Compensation | US$7.6m | US$22m | 100% |
On an industry level, around 14% of total compensation represents salary and 86% is other remuneration. Genpact pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Genpact Limited's Growth Numbers
Genpact Limited has seen its earnings per share (EPS) increase by 10% a year over the past three years. In the last year, its revenue is up 16%.
Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Genpact Limited Been A Good Investment?
We think that the total shareholder return of 38%, over three years, would leave most Genpact Limited shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
To Conclude...
As we touched on above, Genpact Limited is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Few would be critical of the leadership, since returns have been juicy and earnings are moving in the right direction. So one could argue that CEO compensation is quite modest, if you consider company performance! Stockholders might even be okay with a bump in pay, seeing as how investor returns have been so strong.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Genpact that investors should be aware of in a dynamic business environment.
Important note: Genpact 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.
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. 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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