Yahoo Finance Most Shareholders Will Probably Find That The CEO Compensation For Entegris, Inc. (NASDAQ:ENTG) Is Reasonable
Key Insights
Entegris will host its Annual General Meeting on 24th of April
Salary of US$1.00m is part of CEO Bertrand Loy's total remuneration
The overall pay is comparable to the industry average
Entegris' total shareholder return over the past three years was 20% while its EPS was down 18% over the past three years
Despite positive share price growth of 20% for Entegris, Inc. (NASDAQ:ENTG) over the last few years, earnings growth has been disappointing, which suggests something is amiss. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 24th of April. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.
Check out our latest analysis for Entegris
How Does Total Compensation For Bertrand Loy Compare With Other Companies In The Industry?
At the time of writing, our data shows that Entegris, Inc. has a market capitalization of US$20b, and reported total annual CEO compensation of US$13m for the year to December 2023. Notably, that's an increase of 11% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.0m.
In comparison with other companies in the American Semiconductor industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$19m. From this we gather that Bertrand Loy is paid around the median for CEOs in the industry. What's more, Bertrand Loy holds US$22m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.0m | US$1.0m | 7% |
Other | US$12m | US$11m | 93% |
Total Compensation | US$13m | US$12m | 100% |
Talking in terms of the industry, salary represented approximately 11% of total compensation out of all the companies we analyzed, while other remuneration made up 89% of the pie. Entegris sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Entegris, Inc.'s Growth Numbers
Over the last three years, Entegris, Inc. has shrunk its earnings per share by 18% per year. It achieved revenue growth of 7.4% over the last year.
The decline in EPS is a bit concerning. The fairly low revenue growth fails to impress given that the EPS is down. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Entegris, Inc. Been A Good Investment?
Entegris, Inc. has served shareholders reasonably well, with a total return of 20% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
In Summary...
While it's true that shareholders have owned decent returns, it's hard to overlook the lack of earnings growth and this makes us question whether these returns will continue. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.
CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for Entegris you should be aware of, and 1 of them is concerning.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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.
