Yahoo Finance Here's Why Shareholders May Want To Be Cautious With Increasing Westwood Holdings Group, Inc.'s (NYSE:WHG) CEO Pay Packet
Key Insights
Westwood Holdings Group will host its Annual General Meeting on 1st of May
CEO Brian Casey's total compensation includes salary of US$750.0k
The overall pay is 368% above the industry average
Westwood Holdings Group's three-year loss to shareholders was 11% while its EPS grew by 37% over the past three years
As many shareholders of Westwood Holdings Group, Inc. (NYSE:WHG) will be aware, they have not made a gain on their investment in the past three years. 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 1st of May. 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.
See our latest analysis for Westwood Holdings Group
How Does Total Compensation For Brian Casey Compare With Other Companies In The Industry?
According to our data, Westwood Holdings Group, Inc. has a market capitalization of US$107m, and paid its CEO total annual compensation worth US$2.1m over the year to December 2023. Notably, that's an increase of 52% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$750k.
In comparison with other companies in the American Capital Markets industry with market capitalizations under US$200m, the reported median total CEO compensation was US$442k. Accordingly, our analysis reveals that Westwood Holdings Group, Inc. pays Brian Casey north of the industry median. Furthermore, Brian Casey directly owns US$6.3m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$750k | US$750k | 36% |
Other | US$1.3m | US$612k | 64% |
Total Compensation | US$2.1m | US$1.4m | 100% |
Talking in terms of the industry, salary represented approximately 10% of total compensation out of all the companies we analyzed, while other remuneration made up 90% of the pie. Westwood Holdings Group pays out 36% of remuneration in the form of a salary, significantly higher than the industry average. 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 Westwood Holdings Group, Inc.'s Growth Numbers
Over the past three years, Westwood Holdings Group, Inc. has seen its earnings per share (EPS) grow by 37% per year. In the last year, its revenue is up 31%.
Shareholders would be glad to know that the company has improved itself over the last few years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Westwood Holdings Group, Inc. Been A Good Investment?
With a three year total loss of 11% for the shareholders, Westwood Holdings Group, Inc. would certainly have some dissatisfied shareholders. 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 pay is simply one of the many factors that need to be considered while examining business performance. We identified 4 warning signs for Westwood Holdings Group (1 is potentially serious!) that you should be aware of before investing here.
Switching gears from Westwood Holdings Group, 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.
