Yahoo Finance We Think Some Shareholders May Hesitate To Increase Pennant International Group plc's (LON:PEN) CEO Compensation
Key Insights
Pennant International Group to hold its Annual General Meeting on 17th of July
Total pay for CEO Phil Walker includes UK£226.0k salary
The total compensation is 52% higher than the average for the industry
Pennant International Group's EPS grew by 43% over the past three years while total shareholder loss over the past three years was 31%
In the past three years, the share price of Pennant International Group plc (LON:PEN) has struggled to grow and now shareholders are sitting on a loss. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 17th of July. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.
Check out our latest analysis for Pennant International Group
Comparing Pennant International Group plc's CEO Compensation With The Industry
According to our data, Pennant International Group plc has a market capitalization of UK£10m, and paid its CEO total annual compensation worth UK£308k over the year to December 2023. This means that the compensation hasn't changed much from last year. In particular, the salary of UK£226.0k, makes up a huge portion of the total compensation being paid to the CEO.
On comparing similar-sized companies in the British Aerospace & Defense industry with market capitalizations below UK£156m, we found that the median total CEO compensation was UK£202k. Accordingly, our analysis reveals that Pennant International Group plc pays Phil Walker north of the industry median.
Component | 2023 | 2022 | Proportion (2023) |
Salary | UK£226k | UK£219k | 73% |
Other | UK£82k | UK£86k | 27% |
Total Compensation | UK£308k | UK£305k | 100% |
Speaking on an industry level, nearly 41% of total compensation represents salary, while the remainder of 59% is other remuneration. Pennant International Group is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
Pennant International Group plc's Growth
Pennant International Group plc's earnings per share (EPS) grew 43% per year over the last three years. It achieved revenue growth of 14% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 Pennant International Group plc Been A Good Investment?
The return of -31% over three years would not have pleased Pennant International Group plc shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
In Summary...
The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.
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 Pennant International Group that you should be aware of before investing.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
