Embla Medical hf.'s (CPH:EMBLA) CEO Will Probably Find It Hard To See A Huge Raise This Year

Key Insights

• Embla Medical hf's Annual General Meeting to take place on 12th of March
• Salary of US$576.0k is part of CEO Sveinn Solvason's total remuneration
• The overall pay is comparable to the industry average
• Embla Medical hf's EPS grew by 1.8% over the past three years while total shareholder loss over the past three years was 15%

Shareholders of Embla Medical hf. (CPH:EMBLA) 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 12th of March. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. 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 Embla Medical hf

Comparing Embla Medical hf.'s CEO Compensation With The Industry

At the time of writing, our data shows that Embla Medical hf. has a market capitalization of kr.13b, and reported total annual CEO compensation of US$1.0m for the year to December 2024. Notably, that's a decrease of 14% over the year before. Notably, the salary which is US$576.0k, represents a considerable chunk of the total compensation being paid.

For comparison, other companies in the Denmark Medical Equipment industry with market capitalizations ranging between kr.6.9b and kr.22b had a median total CEO compensation of US$1.0m. So it looks like Embla Medical hf compensates Sveinn Solvason in line with the median for the industry. Furthermore, Sveinn Solvason directly owns kr.2.1m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	US$576k	US$576k	57%
Other	US$437k	US$604k	43%
Total Compensation	US$1.0m	US$1.2m	100%

Talking in terms of the industry, salary represented approximately 56% of total compensation out of all the companies we analyzed, while other remuneration made up 44% of the pie. There isn't a significant difference between Embla Medical hf and the broader market, in terms of salary allocation in the overall compensation package. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Embla Medical hf.'s Growth

Over the past three years, Embla Medical hf. has seen its earnings per share (EPS) grow by 1.8% per year. It achieved revenue growth of 8.8% over the last year.

We'd prefer higher revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Embla Medical hf. Been A Good Investment?

Since shareholders would have lost about 15% over three years, some Embla Medical hf. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. 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.

So you may want to check if insiders are buying Embla Medical hf shares with their own money (free access).

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.