We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Imricor Medical Systems, Inc.'s (ASX:IMR) CEO For Now

Key Insights

• Imricor Medical Systems will host its Annual General Meeting on 14th of May
• CEO Steve Wedan's total compensation includes salary of US$464.9k
• Total compensation is 48% above industry average
• Imricor Medical Systems' EPS grew by 1.0% over the past three years while total shareholder loss over the past three years was 75%

Shareholders of Imricor Medical Systems, Inc. (ASX:IMR) will have been dismayed by the negative share price return over the last three years. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 14th of May. They could also influence management through voting on resolutions such as executive remuneration. 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 Imricor Medical Systems

How Does Total Compensation For Steve Wedan Compare With Other Companies In The Industry?

According to our data, Imricor Medical Systems, Inc. has a market capitalization of AU$97m, and paid its CEO total annual compensation worth US$465k over the year to December 2023. There was no change in the compensation compared to last year. Notably, the salary of US$465k is the entirety of the CEO compensation.

For comparison, other companies in the Australian Medical Equipment industry with market capitalizations below AU$304m, reported a median total CEO compensation of US$315k. Hence, we can conclude that Steve Wedan is remunerated higher than the industry median. What's more, Steve Wedan holds AU$2.4m 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$465k	US$465k	100%
Other	-	-	-
Total Compensation	US$465k	US$465k	100%

On an industry level, around 58% of total compensation represents salary and 42% is other remuneration. On a company level, Imricor Medical Systems prefers to reward its CEO through a salary, opting not to pay Steve Wedan through non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Imricor Medical Systems, Inc.'s Growth Numbers

Over the past three years, Imricor Medical Systems, Inc. has seen its earnings per share (EPS) grow by 1.0% per year. It saw its revenue drop 25% over the last year.

We would argue that the lack of revenue growth in the last year is less than ideal, but the modest EPS growth gives us some relief. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. 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 Imricor Medical Systems, Inc. Been A Good Investment?

With a total shareholder return of -75% over three years, Imricor Medical Systems, Inc. shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Imricor Medical Systems rewards its CEO solely through a salary, ignoring non-salary benefits completely. 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. Shareholders would be keen to know what's holding the stock back when earnings have grown. 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 pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 5 warning signs for Imricor Medical Systems you should be aware of, and 2 of them are a bit unpleasant.

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.