This article will reflect on the compensation paid to Ari Bousbib who has served as CEO of IQVIA Holdings Inc. (NYSE:IQV) since 2016. This analysis will also assess whether IQVIA Holdings pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Comparing IQVIA Holdings Inc.’s CEO Compensation With the industry
According to our data, IQVIA Holdings Inc. has a market capitalization of US$32b, and paid its CEO total annual compensation worth US$22m over the year to December 2019. We note that’s an increase of 34% above last year. While this analysis focuses on total compensation, it’s worth acknowledging that the salary portion is lower, valued at US$1.7m.
In comparison with other companies in the industry with market capitalizations over US$8.0b , the reported median total CEO compensation was US$7.7m. Hence, we can conclude that Ari Bousbib is remunerated higher than the industry median. Furthermore, Ari Bousbib directly owns US$201m worth of shares in the company, implying that they are deeply invested in the company’s success.
On an industry level, roughly 15% of total compensation represents salary and 85% is other remuneration. IQVIA Holdings pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at IQVIA Holdings Inc.’s Growth Numbers
IQVIA Holdings Inc.’s earnings per share (EPS) grew 42% per year over the last three years. In the last year, its revenue changed by just 0.7%.
This demonstrates that the company has been improving recently and is good news for the shareholders. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Looking ahead, you might want to check this free visual report on analyst forecasts for the company’s future earnings..
Has IQVIA Holdings Inc. Been A Good Investment?
Most shareholders would probably be pleased with IQVIA Holdings Inc. for providing a total return of 64% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
As we noted earlier, IQVIA Holdings pays its CEO higher than the norm for similar-sized companies belonging to the same industry. But EPS growth and shareholder returns have been top-notch for the past three years. Considering such exceptional results for the company, we’d venture to say CEO compensation is fair. The pleasing shareholder returns are the cherry on top. We wouldn’t be wrong in saying that shareholders feel that Ari’s performance creates value for the company.
CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for IQVIA Holdings you should be aware of, and 1 of them is concerning.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
When trading IQVIA Holdings or any other investment, use the platform considered by many to be the Professional’s Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account.
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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020