We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Computer Programs and Systems, Inc.'s (NASDAQ:CPSI) CEO For Now
Under the guidance of CEO John Douglas, Computer Programs and Systems, Inc. (NASDAQ:CPSI) has performed reasonably well recently. As shareholders go into the upcoming AGM on 13 May 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.
View our latest analysis for Computer Programs and Systems
How Does Total Compensation For John Douglas Compare With Other Companies In The Industry?
According to our data, Computer Programs and Systems, Inc. has a market capitalization of US$441m, and paid its CEO total annual compensation worth US$1.3m over the year to December 2020. That's slightly lower by 7.4% over the previous year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$630k.
On examining similar-sized companies in the industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$495k. This suggests that John Douglas is paid more than the median for the industry. Moreover, John Douglas also holds US$7.6m worth of Computer Programs and Systems stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2020 | 2019 | Proportion (2020) |
Salary | US$630k | US$630k | 49% |
Other | US$644k | US$746k | 51% |
Total Compensation | US$1.3m | US$1.4m | 100% |
Talking in terms of the industry, salary represented approximately 17% of total compensation out of all the companies we analyzed, while other remuneration made up 83% of the pie. Computer Programs and Systems is paying a higher share of its remuneration through a salary in comparison to the overall industry. 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 Computer Programs and Systems, Inc.'s Growth Numbers
Computer Programs and Systems, Inc.'s earnings per share (EPS) grew 78% per year over the last three years. It saw its revenue drop 3.7% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Computer Programs and Systems, Inc. Been A Good Investment?
With a total shareholder return of 2.7% over three years, Computer Programs and Systems, Inc. has done okay by shareholders, but there's always room for improvement. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.
To Conclude...
Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Computer Programs and Systems that investors should think about before committing capital to this 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.
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.
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