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Shareholders may be wondering what CEO Vipin Garg plans to do to improve the less than great performance at Altimmune, Inc. (NASDAQ:ALT) recently. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 23 September 2021. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We think CEO compensation looks appropriate given the data we have put together.
How Does Total Compensation For Vipin Garg Compare With Other Companies In The Industry?
Our data indicates that Altimmune, Inc. has a market capitalization of US$649m, and total annual CEO compensation was reported as US$1.4m for the year to December 2020. Notably, that's an increase of 76% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$514k.
On comparing similar companies from the same industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$3.0m. This suggests that Vipin Garg is paid below the industry median. Furthermore, Vipin Garg directly owns US$4.8m worth of shares in the company, implying that they are deeply invested in the company's success.
Talking in terms of the industry, salary represented approximately 20% of total compensation out of all the companies we analyzed, while other remuneration made up 80% of the pie. According to our research, Altimmune has allocated a higher percentage of pay to salary in comparison to the wider industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
Altimmune, Inc.'s Growth
Altimmune, Inc. has seen its earnings per share (EPS) increase by 129% a year over the past three years. Its revenue is up 50% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 Altimmune, Inc. Been A Good Investment?
Few Altimmune, Inc. shareholders would feel satisfied with the return of -37% over three years. So shareholders would probably want the company to be less generous with CEO compensation.
The loss to shareholders over the past three years is certainly concerning. This contrasts to the strong EPS growth recently however, and suggests that there may be other factors at play driving down the share price. A key question may be why the fundamentals have not yet been reflected into the share price. In the upcoming AGM, shareholders will get the opportunity to discuss these concerns with the board and assess if the board's plan is likely to improve company performance.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 4 warning signs for Altimmune (of which 1 makes us a bit uncomfortable!) that you should know about in order to have a holistic understanding of the stock.
Switching gears from Altimmune, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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.
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