Yahoo Finance Shareholders May Be More Conservative With Kronos Bio, Inc.'s (NASDAQ:KRON) CEO Compensation For Now
Key Insights
Kronos Bio to hold its Annual General Meeting on 25th of June
CEO Norbert Bischofberger's total compensation includes salary of US$580.0k
The total compensation is 51% higher than the average for the industry
Kronos Bio's three-year loss to shareholders was 96% while its EPS grew by 19% over the past three years
In the past three years, the share price of Kronos Bio, Inc. (NASDAQ:KRON) has struggled to grow and now shareholders are sitting on a loss. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. These are some of the concerns that shareholders may want to bring up at the next AGM held on 25th of June. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.
See our latest analysis for Kronos Bio
Comparing Kronos Bio, Inc.'s CEO Compensation With The Industry
According to our data, Kronos Bio, Inc. has a market capitalization of US$61m, and paid its CEO total annual compensation worth US$1.8m over the year to December 2023. That's a notable decrease of 37% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$580k.
For comparison, other companies in the American Biotechs industry with market capitalizations below US$200m, reported a median total CEO compensation of US$1.2m. This suggests that Norbert Bischofberger is paid more than the median for the industry. What's more, Norbert Bischofberger holds US$11m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$580k | US$580k | 33% |
Other | US$1.2m | US$2.2m | 67% |
Total Compensation | US$1.8m | US$2.8m | 100% |
On an industry level, around 23% of total compensation represents salary and 77% is other remuneration. Kronos Bio 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.
Kronos Bio, Inc.'s Growth
Kronos Bio, Inc.'s earnings per share (EPS) grew 19% per year over the last three years. Its revenue is up 521% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Kronos Bio, Inc. Been A Good Investment?
With a total shareholder return of -96% over three years, Kronos Bio, Inc. shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.
In Summary...
Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would be keen to know what's holding the stock back when earnings have grown. At 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 will likely improve performance in the future.
CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 4 warning signs for Kronos Bio that investors should look into moving forward.
Switching gears from Kronos Bio, 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.
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