Yahoo Finance We Think Shareholders Are Less Likely To Approve A Pay Rise For indie Semiconductor, Inc.'s (NASDAQ:INDI) CEO For Now
Key Insights
indie Semiconductor will host its Annual General Meeting on 13th of June
Salary of US$400.0k is part of CEO Donald McClymont's total remuneration
The overall pay is comparable to the industry average
indie Semiconductor's EPS grew by 44% over the past three years while total shareholder loss over the past three years was 29%
In the past three years, the share price of indie Semiconductor, Inc. (NASDAQ:INDI) has struggled to grow and now shareholders are sitting on a loss. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 13th of June. They could also influence management through voting on resolutions such as executive remuneration. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.
View our latest analysis for indie Semiconductor
Comparing indie Semiconductor, Inc.'s CEO Compensation With The Industry
At the time of writing, our data shows that indie Semiconductor, Inc. has a market capitalization of US$1.5b, and reported total annual CEO compensation of US$4.5m for the year to December 2023. Notably, that's an increase of 87% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$400k.
For comparison, other companies in the American Semiconductor industry with market capitalizations ranging between US$1.0b and US$3.2b had a median total CEO compensation of US$5.7m. So it looks like indie Semiconductor compensates Donald McClymont in line with the median for the industry. What's more, Donald McClymont holds US$1.2m worth of shares in the company in their own name.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$400k | US$400k | 9% |
Other | US$4.1m | US$2.0m | 91% |
Total Compensation | US$4.5m | US$2.4m | 100% |
Talking in terms of the industry, salary represented approximately 11% of total compensation out of all the companies we analyzed, while other remuneration made up 89% of the pie. indie Semiconductor pays a modest slice of remuneration through salary, as compared 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.
A Look at indie Semiconductor, Inc.'s Growth Numbers
indie Semiconductor, Inc.'s earnings per share (EPS) grew 44% per year over the last three years. Its revenue is up 82% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has indie Semiconductor, Inc. Been A Good Investment?
Since shareholders would have lost about 29% over three years, some indie Semiconductor, Inc. investors would surely be feeling negative emotions. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. 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.
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 indie Semiconductor that investors should think about before committing capital to this stock.
Switching gears from indie Semiconductor, 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.
