Yahoo Finance It Looks Like Universal Electronics Inc.'s (NASDAQ:UEIC) CEO May Expect Their Salary To Be Put Under The Microscope
Key Insights
Universal Electronics to hold its Annual General Meeting on 11th of June
Total pay for CEO Paul Arling includes US$830.0k salary
Total compensation is 490% above industry average
Universal Electronics' EPS declined by 116% over the past three years while total shareholder loss over the past three years was 77%
Universal Electronics Inc. (NASDAQ:UEIC) has not performed well recently and CEO Paul Arling will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 11th of June. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.
Check out our latest analysis for Universal Electronics
Comparing Universal Electronics Inc.'s CEO Compensation With The Industry
According to our data, Universal Electronics Inc. has a market capitalization of US$147m, and paid its CEO total annual compensation worth US$3.7m over the year to December 2023. We note that's an increase of 24% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$830k.
In comparison with other companies in the American Consumer Durables industry with market capitalizations under US$200m, the reported median total CEO compensation was US$620k. Hence, we can conclude that Paul Arling is remunerated higher than the industry median. Moreover, Paul Arling also holds US$3.4m worth of Universal Electronics 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$830k | US$830k | 23% |
Other | US$2.8m | US$2.1m | 77% |
Total Compensation | US$3.7m | US$3.0m | 100% |
On an industry level, around 18% of total compensation represents salary and 82% is other remuneration. Universal Electronics is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Universal Electronics Inc.'s Growth
Over the last three years, Universal Electronics Inc. has shrunk its earnings per share by 116% per year. Its revenue is down 22% over the previous year.
Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Universal Electronics Inc. Been A Good Investment?
The return of -77% over three years would not have pleased Universal Electronics Inc. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
In Summary...
Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.
If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Universal Electronics.
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.
