It Looks Like Shareholders Would Probably Approve Pioneer Power Solutions, Inc.'s (NASDAQ:PPSI) CEO Compensation Package

Key Insights

• Pioneer Power Solutions will host its Annual General Meeting on 9th of November
• Salary of US$535.5k is part of CEO Nathan Mazurek's total remuneration
• The overall pay is comparable to the industry average
• Pioneer Power Solutions' total shareholder return over the past three years was 134% while its EPS grew by 56% over the past three years

We have been pretty impressed with the performance at Pioneer Power Solutions, Inc. (NASDAQ:PPSI) recently and CEO Nathan Mazurek deserves a mention for their role in it. Coming up to the next AGM on 9th of November, shareholders would be keeping this in mind. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Pioneer Power Solutions

How Does Total Compensation For Nathan Mazurek Compare With Other Companies In The Industry?

Our data indicates that Pioneer Power Solutions, Inc. has a market capitalization of US$60m, and total annual CEO compensation was reported as US$558k for the year to December 2022. That's a notable increase of 9.7% on last year. We note that the salary portion, which stands at US$535.5k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the American Electrical industry with market capitalizations under US$200m, the reported median total CEO compensation was US$668k. This suggests that Pioneer Power Solutions remunerates its CEO largely in line with the industry average. Moreover, Nathan Mazurek also holds US$12m worth of Pioneer Power Solutions stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2022	2021	Proportion (2022)
Salary	US$536k	US$430k	96%
Other	US$22k	US$78k	4%
Total Compensation	US$558k	US$508k	100%

Speaking on an industry level, nearly 20% of total compensation represents salary, while the remainder of 80% is other remuneration. Pioneer Power Solutions is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to 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.

Pioneer Power Solutions, Inc.'s Growth

Over the past three years, Pioneer Power Solutions, Inc. has seen its earnings per share (EPS) grow by 56% per year. It achieved revenue growth of 78% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 Pioneer Power Solutions, Inc. Been A Good Investment?

Boasting a total shareholder return of 134% over three years, Pioneer Power Solutions, Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Nathan receives almost all of their compensation through a salary. Some shareholders will probably be more lenient on CEO compensation in the upcoming AGM given the pleasing performance of the company recently. Seeing that earnings growth and share price performance seems to be on the right path, the more pressing focus for shareholders at the AGM may be how the board and management plans to turn the company into a sustainably profitable one.

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 3 warning signs for Pioneer Power Solutions that you should be aware of before investing.

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.