Yahoo Finance We Think Some Shareholders May Hesitate To Increase Coherus BioSciences, Inc.'s (NASDAQ:CHRS) CEO Compensation
Key Insights
Coherus BioSciences to hold its Annual General Meeting on 29th of May
Salary of US$982.9k is part of CEO Denny Lanfear's total remuneration
The total compensation is 123% higher than the average for the industry
Coherus BioSciences' three-year loss to shareholders was 84% while its EPS grew by 2.6% over the past three years
Shareholders of Coherus BioSciences, Inc. (NASDAQ:CHRS) will have been dismayed by the negative share price return over the last three years. 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 29th of May. 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.
See our latest analysis for Coherus BioSciences
How Does Total Compensation For Denny Lanfear Compare With Other Companies In The Industry?
According to our data, Coherus BioSciences, Inc. has a market capitalization of US$239m, and paid its CEO total annual compensation worth US$5.9m over the year to December 2023. That's a notable decrease of 14% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$983k.
For comparison, other companies in the American Biotechs industry with market capitalizations ranging between US$100m and US$400m had a median total CEO compensation of US$2.6m. Hence, we can conclude that Denny Lanfear is remunerated higher than the industry median. What's more, Denny Lanfear holds US$2.4m worth of shares in the company in their own name.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$983k | US$945k | 17% |
Other | US$4.9m | US$5.9m | 83% |
Total Compensation | US$5.9m | US$6.9m | 100% |
Speaking on an industry level, nearly 24% of total compensation represents salary, while the remainder of 76% is other remuneration. It's interesting to note that Coherus BioSciences allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Coherus BioSciences, Inc.'s Growth
Coherus BioSciences, Inc.'s earnings per share (EPS) grew 2.6% per year over the last three years. In the last year, its revenue is up 65%.
We like the look of the strong year-on-year improvement in revenue. With that in mind, the modestly improving EPS seems positive. So while we'd stop short of saying growth is absolutely outstanding, there are definitely some clear positives! 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 Coherus BioSciences, Inc. Been A Good Investment?
The return of -84% over three years would not have pleased Coherus BioSciences, Inc. shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
Shareholders have not seen their shares grow in value, rather they have seen their shares decline. 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. Shareholders would be keen to know what's holding the stock back when earnings have grown. 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 is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 2 warning signs for Coherus BioSciences (of which 1 can't be ignored!) that you should know about in order to have a holistic understanding of the 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.
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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.
