Astronics Corporation's (NASDAQ:ATRO) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Astronics' Annual General Meeting to take place on 8th of May
• Salary of US$606.3k is part of CEO Peter Gundermann's total remuneration
• The overall pay is 66% above the industry average
• Over the past three years, Astronics' EPS grew by 39% and over the past three years, the total loss to shareholders 3.1%

As many shareholders of Astronics Corporation (NASDAQ:ATRO) will be aware, they have not made a gain on their investment in the past three years. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. These are some of the concerns that shareholders may want to bring up at the next AGM held on 8th of May. 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.

Check out our latest analysis for Astronics

Comparing Astronics Corporation's CEO Compensation With The Industry

At the time of writing, our data shows that Astronics Corporation has a market capitalization of US$579m, and reported total annual CEO compensation of US$2.7m for the year to December 2023. That's a notable increase of 62% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$606k.

On comparing similar companies from the American Aerospace & Defense industry with market caps ranging from US$200m to US$800m, we found that the median CEO total compensation was US$1.6m. Accordingly, our analysis reveals that Astronics Corporation pays Peter Gundermann north of the industry median. What's more, Peter Gundermann holds US$14m 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$606k	US$589k	23%
Other	US$2.0m	US$1.1m	77%
Total Compensation	US$2.7m	US$1.6m	100%

On an industry level, around 23% of total compensation represents salary and 77% is other remuneration. Although there is a difference in how total compensation is set, Astronics more or less reflects the market in terms of setting the salary. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Astronics Corporation's Growth

Astronics Corporation has seen its earnings per share (EPS) increase by 39% a year over the past three years. It achieved revenue growth of 29% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Astronics Corporation Been A Good Investment?

With a three year total loss of 3.1% for the shareholders, Astronics Corporation would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Shareholders have not seen their shares grow in value, rather they have seen their shares decline. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 3 warning signs for Astronics (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

Switching gears from Astronics, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.