Shareholders Will Probably Hold Off On Increasing IEC Electronics Corp.'s (NASDAQ:IEC) CEO Compensation For The Time Being
Under the guidance of CEO Jeff Schlarbaum, IEC Electronics Corp. (NASDAQ:IEC) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 10 March 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.
Check out our latest analysis for IEC Electronics
How Does Total Compensation For Jeff Schlarbaum Compare With Other Companies In The Industry?
According to our data, IEC Electronics Corp. has a market capitalization of US$132m, and paid its CEO total annual compensation worth US$1.2m over the year to September 2020. This means that the compensation hasn't changed much from last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$412k.
In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$429k. Hence, we can conclude that Jeff Schlarbaum is remunerated higher than the industry median. What's more, Jeff Schlarbaum holds US$1.1m worth of shares in the company in their own name.
Component | 2020 | 2019 | Proportion (2020) |
Salary | US$412k | US$395k | 34% |
Other | US$789k | US$806k | 66% |
Total Compensation | US$1.2m | US$1.2m | 100% |
On an industry level, around 33% of total compensation represents salary and 67% is other remuneration. IEC Electronics is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
IEC Electronics Corp.'s Growth
IEC Electronics Corp.'s earnings per share (EPS) grew 148% per year over the last three years. Its revenue is up 11% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has IEC Electronics Corp. Been A Good Investment?
We think that the total shareholder return of 196%, over three years, would leave most IEC Electronics Corp. shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for IEC Electronics that you should be aware of before investing.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
