News out!!
ncreases to CEO Compensation Might Be Put On Hold For Now at NextPlat Corp (NASDAQ:NXPL)
Key Insights
NextPlat's Annual General Meeting to take place on 13th of September
Salary of US$468.0k is part of CEO Charles Fernandez's total remuneration
The total compensation is 771% higher than the average for the industry
Over the past three years, NextPlat's EPS grew by 66% and over the past three years, the total loss to shareholders 80%
In the past three years, the share price of NextPlat Corp (NASDAQ:NXPL) has struggled to grow and now shareholders are sitting on a loss. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 13th of September. They could also influence management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.
View our latest analysis for NextPlat
Comparing NextPlat Corp's CEO Compensation With The Industry
Our data indicates that NextPlat Corp has a market capitalization of US$23m, and total annual CEO compensation was reported as US$3.3m for the year to December 2023. We note that's an increase of 33% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$468k.
In comparison with other companies in the American Telecom industry with market capitalizations under US$200m, the reported median total CEO compensation was US$376k. Accordingly, our analysis reveals that NextPlat Corp pays Charles Fernandez north of the industry median. What's more, Charles Fernandez holds US$4.8m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, roughly 17% of total compensation represents salary and 83% is other remuneration. In NextPlat's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
NextPlat Corp's Growth
NextPlat Corp has seen its earnings per share (EPS) increase by 66% a year over the past three years. It achieved revenue growth of 499% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has NextPlat Corp Been A Good Investment?
Few NextPlat Corp shareholders would feel satisfied with the return of -80% over three years. So shareholders would probably want the company to be less generous with CEO compensation.
In Summary...
Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 2 warning signs for NextPlat (of which 1 is concerning!) that you should know about in order to have a holistic understanding of the stock.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.??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.
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