Yahoo Finance Should You Worry About Acorda Therapeutics Inc’s (NASDAQ:ACOR) CEO Pay?
Ron Cohen became the CEO of Acorda Therapeutics Inc (NASDAQ:ACOR) in 1995. First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for Acorda Therapeutics
How Does Ron Cohen’s Compensation Compare With Similar Sized Companies?
According to our data, Acorda Therapeutics Inc has a market capitalization of US$906m, and pays its CEO total annual compensation worth US$2.0m. (This number is for the twelve months until 2017). While we always look at total compensation first, we note that the salary component is less, at US$792k. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO compensation of that group was US$2.3m.
So Ron Cohen receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at Acorda Therapeutics has changed from year to year.
Is Acorda Therapeutics Inc Growing?
Acorda Therapeutics Inc has reduced its earnings per share by an average of 98% a year, over the last three years. Its revenue is up 9.3% over last year.
Unfortunately, earnings per share have trended lower over the last three years. And the modest revenue growth over 12 months isn’t much comfort against the reduced earnings per share. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Acorda Therapeutics Inc Been A Good Investment?
Since shareholders would have lost about 50% over three years, some Acorda Therapeutics Inc shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary…
Remuneration for Ron Cohen is close enough to the median pay for a CEO of a similar sized company .
After looking at EPS and total shareholder returns, it’s certainly hard to argue the company has performed well, since both metrics are down. Few would argue that it’s wise for the company to pay any more, before returns improve. Whatever your view on compensation, you might want to check if insiders are buying or selling Acorda Therapeutics shares (free trial).
Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.