David Schenkein has been the CEO of Agios Pharmaceuticals, Inc. (NASDAQ:AGIO) since 2009. 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 process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Agios Pharmaceuticals

How Does David Schenkein’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Agios Pharmaceuticals, Inc. has a market cap of US$3.3b, and is paying total annual CEO compensation of US$6.0m. (This figure is for the year to 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$585k. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO compensation was US$5.1m.

So David Schenkein 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.

You can see, below, how CEO compensation at Agios Pharmaceuticals has changed over time.

Is Agios Pharmaceuticals, Inc. Growing?

Over the last three years Agios Pharmaceuticals, Inc. has shrunk its earnings per share by an average of 25% per year. Its revenue is up 33% over last year.

Investors should note that, over three years, earnings per share are down. But on the other hand, revenue growth is strong, suggesting a brighter future. These two metric are moving in different directions, so while it’s hard to be confident judging performance, we think the stock is worth watching.

You might want to check this free visual report on analyst forecasts for future earnings.

Has Agios Pharmaceuticals, Inc. Been A Good Investment?

With a three year total loss of 5.7%, Agios Pharmaceuticals, Inc. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary…

David Schenkein is paid around what is normal the leaders of comparable size companies.

The per share growth could be better, in our view. And we think the shareholder returns – over three years – have been underwhelming. So many would argue that the CEO is certainly not underpaid. Whatever your view on compensation, you might want to check if insiders are buying or selling Agios Pharmaceuticals shares (free trial).

Or you might rather take a peek at this analytical visualization of historic cash flow, 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.