Here's Why IDEX Corporation's (NYSE:IEX) CEO Compensation Is The Least Of Shareholders Concerns

Key Insights

• IDEX will host its Annual General Meeting on 8th of May
• Total pay for CEO Eric Ashleman includes US$1.04m salary
• Total compensation is 33% below industry average
• IDEX's three-year loss to shareholders was 8.6% while its EPS grew by 4.2% over the past three years

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Performance at IDEX Corporation (NYSE:IEX) has been rather uninspiring recently and shareholders may be wondering how CEO Eric Ashleman plans to fix this. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 8th of May. It has been shown that setting appropriate executive remuneration incentivises the management to act in the interests of shareholders. In our opinion, CEO compensation does not look excessive and we discuss why.

See our latest analysis for IDEX

Comparing IDEX Corporation's CEO Compensation With The Industry

At the time of writing, our data shows that IDEX Corporation has a market capitalization of US$13b, and reported total annual CEO compensation of US$9.4m for the year to December 2024. Notably, that's an increase of 21% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.0m.

For comparison, other companies in the American Machinery industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$14m. Accordingly, IDEX pays its CEO under the industry median. Moreover, Eric Ashleman also holds US$10m worth of IDEX stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 15% of total compensation represents salary and 85% is other remuneration. IDEX pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at IDEX Corporation's Growth Numbers

IDEX Corporation has seen its earnings per share (EPS) increase by 4.2% a year over the past three years. The trailing twelve months of revenue was pretty much the same as the prior period.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 IDEX Corporation Been A Good Investment?

Since shareholders would have lost about 8.6% over three years, some IDEX Corporation investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

The lack lustre share price performance may have something to do with the flat earnings growth. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board and assess if the board's plan is likely to improve company performance.

Shareholders may want to check for free if IDEX insiders are buying or selling shares.

Switching gears from IDEX, 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.