Yahoo Finance Shareholders May Be More Conservative With Verint Systems Inc.'s (NASDAQ:VRNT) CEO Compensation For Now
Key Insights
Verint Systems to hold its Annual General Meeting on 10th of July
Total pay for CEO Dan Bodner includes US$790.0k salary
Total compensation is 57% above industry average
Verint Systems' three-year loss to shareholders was 27% while its EPS grew by 108% over the past three years
The underwhelming share price performance of Verint Systems Inc. (NASDAQ:VRNT) in the past three years would have disappointed many 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 10th of July could be an opportunity for shareholders to bring these concerns to the board's attention. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.
Check out our latest analysis for Verint Systems
Comparing Verint Systems Inc.'s CEO Compensation With The Industry
At the time of writing, our data shows that Verint Systems Inc. has a market capitalization of US$2.0b, and reported total annual CEO compensation of US$9.0m for the year to January 2024. That's a notable decrease of 26% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$790k.
In comparison with other companies in the American Software industry with market capitalizations ranging from US$1.0b to US$3.2b, the reported median CEO total compensation was US$5.7m. This suggests that Dan Bodner is paid more than the median for the industry. What's more, Dan Bodner holds US$13m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2024 | 2023 | Proportion (2024) |
Salary | US$790k | US$784k | 9% |
Other | US$8.3m | US$11m | 91% |
Total Compensation | US$9.0m | US$12m | 100% |
On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. It's interesting to note that Verint Systems allocates a smaller portion of compensation to salary in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
Verint Systems Inc.'s Growth
Verint Systems Inc.'s earnings per share (EPS) grew 108% per year over the last three years. Its revenue is up 1.6% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 Verint Systems Inc. Been A Good Investment?
Since shareholders would have lost about 27% over three years, some Verint Systems Inc. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Verint Systems that investors should look into moving forward.
Important note: Verint Systems 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
