Yahoo Finance It's Unlikely That The CEO Of Veracyte, Inc. (NASDAQ:VCYT) Will See A Huge Pay Rise This Year
Key Insights
Veracyte will host its Annual General Meeting on 12th of June
CEO Marc Stapley's total compensation includes salary of US$650.0k
The overall pay is comparable to the industry average
Veracyte's three-year loss to shareholders was 39% while its EPS grew by 16% over the past three years
In the past three years, the share price of Veracyte, Inc. (NASDAQ:VCYT) has struggled to grow and now shareholders are sitting on a loss. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 12th of June. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.
View our latest analysis for Veracyte
Comparing Veracyte, Inc.'s CEO Compensation With The Industry
At the time of writing, our data shows that Veracyte, Inc. has a market capitalization of US$1.6b, and reported total annual CEO compensation of US$7.2m for the year to December 2023. We note that's an increase of 46% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$650k.
In comparison with other companies in the American Biotechs industry with market capitalizations ranging from US$1.0b to US$3.2b, the reported median CEO total compensation was US$7.2m. This suggests that Veracyte remunerates its CEO largely in line with the industry average. What's more, Marc Stapley holds US$2.5m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$650k | US$625k | 9% |
Other | US$6.5m | US$4.3m | 91% |
Total Compensation | US$7.2m | US$4.9m | 100% |
On an industry level, roughly 23% of total compensation represents salary and 77% is other remuneration. In Veracyte's case, non-salary compensation represents a greater slice of total remuneration, 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.
Veracyte, Inc.'s Growth
Veracyte, Inc.'s earnings per share (EPS) grew 16% per year over the last three years. In the last year, its revenue is up 21%.
This demonstrates that the company has been improving recently and is good news for the shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Veracyte, Inc. Been A Good Investment?
Few Veracyte, Inc. shareholders would feel satisfied with the return of -39% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. 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. We did our research and spotted 1 warning sign for Veracyte that investors should look into moving forward.
Important note: Veracyte 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.
