Yahoo Finance Increases to CEO Compensation Might Be Put On Hold For Now at Weis Markets, Inc. (NYSE:WMK)
Key Insights
Weis Markets will host its Annual General Meeting on 2nd of May
CEO Jonathan Weis' total compensation includes salary of US$1.26m
Total compensation is 58% above industry average
Weis Markets' total shareholder return over the past three years was 30% while its EPS was down 4.4% over the past three years
Despite Weis Markets, Inc.'s (NYSE:WMK) share price growing positively in the past few years, the per-share earnings growth has not grown to investors' expectations, suggesting that there could be other factors at play driving the share price. Some of these issues will occupy shareholders' minds as the AGM rolls around on 2nd of May. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. In our analysis below, we show why shareholders may consider holding off a raise for the CEO's compensation until company performance improves.
View our latest analysis for Weis Markets
Comparing Weis Markets, Inc.'s CEO Compensation With The Industry
Our data indicates that Weis Markets, Inc. has a market capitalization of US$1.7b, and total annual CEO compensation was reported as US$9.9m for the year to December 2023. That is, the compensation was roughly the same as last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.3m.
On examining similar-sized companies in the American Consumer Retailing industry with market capitalizations between US$1.0b and US$3.2b, we discovered that the median CEO total compensation of that group was US$6.2m. Accordingly, our analysis reveals that Weis Markets, Inc. pays Jonathan Weis north of the industry median. Moreover, Jonathan Weis also holds US$673m worth of Weis Markets stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.3m | US$1.2m | 13% |
Other | US$8.6m | US$8.9m | 87% |
Total Compensation | US$9.9m | US$10m | 100% |
On an industry level, roughly 12% of total compensation represents salary and 88% is other remuneration. There isn't a significant difference between Weis Markets and the broader market, in terms of salary allocation in the overall compensation package. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Weis Markets, Inc.'s Growth Numbers
Over the last three years, Weis Markets, Inc. has shrunk its earnings per share by 4.4% per year. In the last year, its revenue changed by just 0.06%.
Few shareholders would be pleased to read that EPS have declined. And the flat revenue hardly impresses. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Weis Markets, Inc. Been A Good Investment?
Weis Markets, Inc. has served shareholders reasonably well, with a total return of 30% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Despite the positive returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about whether these returns will continue. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.
So you may want to check if insiders are buying Weis Markets shares with their own money (free access).
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.
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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.
