Yahoo Finance Shareholders May Be Wary Of Increasing Culp, Inc.'s (NYSE:CULP) CEO Compensation Package
Key Insights
Culp's Annual General Meeting to take place on 27th of September
Salary of US$500.0k is part of CEO Robert Culp's total remuneration
The total compensation is similar to the average for the industry
Culp's three-year loss to shareholders was 53% while its EPS was down 52% over the past three years
Culp, Inc. (NYSE:CULP) has not performed well recently and CEO Robert Culp will probably need to up their game. At the upcoming AGM on 27th of September, shareholders can hear from the board including their plans for turning around performance. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.
View our latest analysis for Culp
Comparing Culp, Inc.'s CEO Compensation With The Industry
According to our data, Culp, Inc. has a market capitalization of US$70m, and paid its CEO total annual compensation worth US$1.2m over the year to April 2023. We note that's an increase of 13% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$500k.
In comparison with other companies in the American Luxury industry with market capitalizations under US$200m, the reported median total CEO compensation was US$1.2m. From this we gather that Robert Culp is paid around the median for CEOs in the industry. Moreover, Robert Culp also holds US$1.8m worth of Culp stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$500k | US$482k | 41% |
Other | US$723k | US$603k | 59% |
Total Compensation | US$1.2m | US$1.1m | 100% |
Talking in terms of the industry, salary represented approximately 24% of total compensation out of all the companies we analyzed, while other remuneration made up 76% of the pie. It's interesting to note that Culp pays out a greater portion of remuneration through salary, compared to the industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Culp, Inc.'s Growth
Over the last three years, Culp, Inc. has shrunk its earnings per share by 52% per year. Its revenue is down 17% over the previous year.
Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Culp, Inc. Been A Good Investment?
With a total shareholder return of -53% over three years, Culp, Inc. shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.
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 1 warning sign for Culp that investors should be aware of in a dynamic business environment.
Important note: Culp 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.
