Yahoo Finance Here's Why Shareholders May Want To Be Cautious With Increasing Accel Entertainment, Inc.'s (NYSE:ACEL) CEO Pay Packet
Key Insights
Accel Entertainment's Annual General Meeting to take place on 9th of May
CEO Andy Rubenstein's total compensation includes salary of US$880.3k
The overall pay is comparable to the industry average
Accel Entertainment's EPS grew by 61% over the past three years while total shareholder loss over the past three years was 7.9%
In the past three years, the share price of Accel Entertainment, Inc. (NYSE:ACEL) has struggled to generate growth for its shareholders. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 9th of May could be an opportunity for shareholders to bring these concerns to the board's attention. 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.
Check out our latest analysis for Accel Entertainment
Comparing Accel Entertainment, Inc.'s CEO Compensation With The Industry
Our data indicates that Accel Entertainment, Inc. has a market capitalization of US$911m, and total annual CEO compensation was reported as US$5.8m for the year to December 2023. That's a notable increase of 54% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$880k.
On examining similar-sized companies in the American Hospitality industry with market capitalizations between US$400m and US$1.6b, we discovered that the median CEO total compensation of that group was US$4.7m. From this we gather that Andy Rubenstein is paid around the median for CEOs in the industry. Furthermore, Andy Rubenstein 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$880k | US$789k | 15% |
Other | US$5.0m | US$3.0m | 85% |
Total Compensation | US$5.8m | US$3.8m | 100% |
Talking in terms of the industry, salary represented approximately 17% of total compensation out of all the companies we analyzed, while other remuneration made up 83% of the pie. It's interesting to note that Accel Entertainment allocates a smaller portion of compensation to salary in comparison to the broader industry. 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 Accel Entertainment, Inc.'s Growth Numbers
Accel Entertainment, Inc.'s earnings per share (EPS) grew 61% per year over the last three years. It achieved revenue growth of 21% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Accel Entertainment, Inc. Been A Good Investment?
With a three year total loss of 7.9% for the shareholders, Accel Entertainment, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. 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 can have a massive impact on performance, but it's just one element. We've identified 2 warning signs for Accel Entertainment that investors should be aware of in a dynamic business environment.
Important note: Accel Entertainment is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.
