Yahoo Finance Shareholders Will Probably Hold Off On Increasing Life360, Inc.'s (ASX:360) CEO Compensation For The Time Being
Key Insights
Life360 will host its Annual General Meeting on 29th of May
Salary of US$500.0k is part of CEO Christopher Hulls's total remuneration
The total compensation is 159% higher than the average for the industry
Life360's EPS declined by 4.6% over the past three years while total shareholder return over the past three years was 167%
Performance at Life360, Inc. (ASX:360) has been reasonably good and CEO Christopher Hulls has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 29th of May, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.
Check out our latest analysis for Life360
How Does Total Compensation For Christopher Hulls Compare With Other Companies In The Industry?
At the time of writing, our data shows that Life360, Inc. has a market capitalization of AU$3.2b, and reported total annual CEO compensation of US$1.9m for the year to December 2023. That's a notable decrease of 51% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$500k.
On examining similar-sized companies in the Australian Software industry with market capitalizations between AU$1.5b and AU$4.8b, we discovered that the median CEO total compensation of that group was US$738k. Hence, we can conclude that Christopher Hulls is remunerated higher than the industry median. Moreover, Christopher Hulls also holds AU$96m worth of Life360 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$500k | 26% |
Other | US$1.4m | US$3.4m | 74% |
Total Compensation | US$1.9m | US$3.9m | 100% |
On an industry level, roughly 56% of total compensation represents salary and 44% is other remuneration. It's interesting to note that Life360 allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Life360, Inc.'s Growth
Life360, Inc. has reduced its earnings per share by 4.6% a year over the last three years. In the last year, its revenue is up 28%.
Investors would be a bit wary of companies that have lower EPS But in contrast the revenue growth is strong, suggesting future potential for EPS growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Life360, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Life360, Inc. for providing a total return of 167% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
In Summary...
Some shareholders will be pleased by the relatively good results, however, the results could still be improved. We still think that some shareholders will be hesitant of increasing CEO pay until EPS growth improves, since they are already paid higher than the industry.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Life360 that investors should think about before committing capital to this stock.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.
