Key Insights

• Insmed to hold its Annual General Meeting on 13th of May

• Salary of US$780.0k is part of CEO Will Lewis's total remuneration

• The total compensation is similar to the average for the industry

• Over the past three years, Insmed's EPS fell by 18% and over the past three years, the total loss to shareholders 0.2%

In the past three years, the share price of Insmed Incorporated (NASDAQ:INSM) has struggled to generate growth for its shareholders. Per share earnings growth is also poor, despite revenues growing. Shareholders will have a chance to take their concerns to the board at the next AGM on 13th of May and vote on resolutions including executive compensation, which studies show may have an impact on company performance. Here's our take on why we think shareholders might be hesitant about approving a raise at the moment.

See our latest analysis for Insmed

How Does Total Compensation For Will Lewis Compare With Other Companies In The Industry?

According to our data, Insmed Incorporated has a market capitalization of US$3.9b, and paid its CEO total annual compensation worth US$10m over the year to December 2023. Notably, that's an increase of 34% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$780k.

In comparison with other companies in the American Biotechs industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$8.0m. From this we gather that Will Lewis is paid around the median for CEOs in the industry. Moreover, Will Lewis also holds US$11m worth of Insmed stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 23% of total compensation represents salary and 77% is other remuneration. Insmed 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.

Insmed Incorporated's Growth

Insmed Incorporated has reduced its earnings per share by 18% a year over the last three years. It achieved revenue growth of 24% over the last year.

Investors would be a bit wary of companies that have lower EPS But in contrast the revenue growth is strong, suggesting future potential for EPS growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Insmed Incorporated Been A Good Investment?

Since shareholders would have lost about 0.2% over three years, some Insmed Incorporated investors would surely be feeling negative emotions. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The loss to shareholders over the past three years is certainly concerning and possibly has something to do with the fact that the company's earnings haven't grown. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 3 warning signs (and 1 which is a bit concerning) in Insmed we think you should know about.

Switching gears from Insmed, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.