Yahoo Finance Should Shareholders Have Second Thoughts About A Pay Rise For Ginkgo Bioworks Holdings, Inc.'s (NYSE:DNA) CEO This Year?
Key Insights
Ginkgo Bioworks Holdings' Annual General Meeting to take place on 13th of June
Salary of US$250.0k is part of CEO Jason Kelly's total remuneration
Total compensation is 94% below industry average
Ginkgo Bioworks Holdings' EPS declined by 1.5% over the past three years while total shareholder loss over the past three years was 95%
The underwhelming performance at Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) recently has probably not pleased shareholders. At the upcoming AGM on 13th of June, shareholders may have the opportunity to influence management to turn the performance around by voting on resolutions such as executive remuneration and other matters. We think most shareholders will probably pass the CEO compensation, based on what we gathered.
See our latest analysis for Ginkgo Bioworks Holdings
Comparing Ginkgo Bioworks Holdings, Inc.'s CEO Compensation With The Industry
According to our data, Ginkgo Bioworks Holdings, Inc. has a market capitalization of US$1.2b, and paid its CEO total annual compensation worth US$263k over the year to December 2023. There was no change in the compensation compared to last year. Notably, the salary which is US$250.0k, represents most of the total compensation being paid.
In comparison with other companies in the American Chemicals industry with market capitalizations ranging from US$400m to US$1.6b, the reported median CEO total compensation was US$4.2m. In other words, Ginkgo Bioworks Holdings pays its CEO lower than the industry median. Furthermore, Jason Kelly directly owns US$47m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$250k | US$250k | 95% |
Other | US$13k | US$13k | 5% |
Total Compensation | US$263k | US$263k | 100% |
On an industry level, roughly 19% of total compensation represents salary and 81% is other remuneration. Ginkgo Bioworks Holdings pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
A Look at Ginkgo Bioworks Holdings, Inc.'s Growth Numbers
Over the last three years, Ginkgo Bioworks Holdings, Inc. has shrunk its earnings per share by 1.5% per year. It saw its revenue drop 46% over the last year.
A lack of EPS improvement is not good to see. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Ginkgo Bioworks Holdings, Inc. Been A Good Investment?
With a total shareholder return of -95% over three years, Ginkgo Bioworks Holdings, Inc. shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Ginkgo Bioworks Holdings pays its CEO a majority of compensation through a salary. Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 4 warning signs for Ginkgo Bioworks Holdings that investors should be aware of in a dynamic business environment.
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.
