In This Article:
Tom Stanton has been the CEO of ADTRAN, Inc. (NASDAQ:ADTN) since 2005, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for ADTRAN.
See our latest analysis for ADTRAN
How Does Total Compensation For Tom Stanton Compare With Other Companies In The Industry?
At the time of writing, our data shows that ADTRAN, Inc. has a market capitalization of US$726m, and reported total annual CEO compensation of US$2.0m for the year to December 2019. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$656k.
On comparing similar companies from the same industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$2.7m. This suggests that ADTRAN remunerates its CEO largely in line with the industry average. Furthermore, Tom Stanton directly owns US$2.4m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | US$656k | US$656k | 33% |
| Other | US$1.3m | US$1.3m | 67% |
| Total Compensation | US$2.0m | US$2.0m | 100% |
On an industry level, roughly 29% of total compensation represents salary and 71% is other remuneration. ADTRAN is paying a higher share of its remuneration through a salary in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
ADTRAN, Inc.'s Growth
Over the last three years, ADTRAN, Inc. has shrunk its earnings per share by 91% per year. In the last year, its revenue is down 11%.
Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 ADTRAN, Inc. Been A Good Investment?
With a three year total loss of 27% for the shareholders, ADTRAN, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.