Increases to Seres Therapeutics, Inc.'s (NASDAQ:MCRB) CEO Compensation Might Cool off for now
Key Insights
Seres Therapeutics' Annual General Meeting to take place on 4th of April
CEO Eric Shaff's total compensation includes salary of US$685.0k
Total compensation is 163% above industry average
Over the past three years, Seres Therapeutics' EPS fell by 12% and over the past three years, the total loss to shareholders 96%
In the past three years, the share price of Seres Therapeutics, Inc. (NASDAQ:MCRB) has struggled to grow and now shareholders are sitting on a loss. Per share earnings growth is also lacking, despite revenue growth. Shareholders will have a chance to take their concerns to the board at the next AGM on 4th of April 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.
Check out our latest analysis for Seres Therapeutics
Comparing Seres Therapeutics, Inc.'s CEO Compensation With The Industry
At the time of writing, our data shows that Seres Therapeutics, Inc. has a market capitalization of US$118m, and reported total annual CEO compensation of US$3.2m for the year to December 2023. Notably, that's a decrease of 21% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$685k.
In comparison with other companies in the American Biotechs industry with market capitalizations under US$200m, the reported median total CEO compensation was US$1.2m. Accordingly, our analysis reveals that Seres Therapeutics, Inc. pays Eric Shaff north of the industry median. What's more, Eric Shaff holds US$106k worth of shares in the company in their own name.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$685k | US$662k | 22% |
Other | US$2.5m | US$3.3m | 78% |
Total Compensation | US$3.2m | US$4.0m | 100% |
Speaking on an industry level, nearly 23% of total compensation represents salary, while the remainder of 77% is other remuneration. There isn't a significant difference between Seres Therapeutics and the broader market, in terms of salary allocation in the overall compensation package. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at Seres Therapeutics, Inc.'s Growth Numbers
Seres Therapeutics, Inc. has reduced its earnings per share by 12% a year over the last three years. In the last year, its revenue is up 1,672%.
Investors would be a bit wary of companies that have lower EPS On the other hand, the strong revenue growth suggests the business is growing. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Seres Therapeutics, Inc. Been A Good Investment?
With a total shareholder return of -96% over three years, Seres Therapeutics, Inc. shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
To Conclude...
The company's earnings haven't grown and possibly because of that, the stock has performed poorly, resulting in a loss for the company's shareholders. In the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan is in line with their expectations.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 4 warning signs for Seres Therapeutics (of which 1 is concerning!) that you should know about in order to have a holistic understanding of the stock.
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.
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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.
