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Mark Jagiela has been the CEO of Teradyne, Inc. (NASDAQ:TER) since 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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 method should give us information to assess how appropriately the company pays the CEO.
How Does Mark Jagiela's Compensation Compare With Similar Sized Companies?
According to our data, Teradyne, Inc. has a market capitalization of US$8.6b, and pays its CEO total annual compensation worth US$7.2m. (This number is for the twelve months until December 2018). That's less than last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$905k. When we examined a selection of companies with market caps ranging from US$4.0b to US$12b, we found the median CEO total compensation was US$6.8m.
So Mark Jagiela is paid around the average of 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 Teradyne has changed from year to year.
Is Teradyne, Inc. Growing?
Teradyne, Inc. has increased its earnings per share (EPS) by an average of 63% a year, over the last three years (using a line of best fit). Its revenue is down -2.7% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Teradyne, Inc. Been A Good Investment?
Boasting a total shareholder return of 170% over three years, Teradyne, Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
Mark Jagiela is paid around what is normal the leaders of comparable size companies.
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. So one could argue the CEO compensation is quite modest, if you consider company performance! Shareholders may want to check for free if Teradyne insiders are buying or selling shares.
Important note: Teradyne may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.