Shareholders May Find It Hard To Justify Increasing Staffing 360 Solutions, Inc.'s (NASDAQ:STAF) CEO Compensation For Now

Shareholders of Staffing 360 Solutions, Inc. (NASDAQ:STAF) will have been dismayed by the negative share price return over the last three years. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 30 September 2021. 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.

See our latest analysis for Staffing 360 Solutions

How Does Total Compensation For Brendan Flood Compare With Other Companies In The Industry?

Our data indicates that Staffing 360 Solutions, Inc. has a market capitalization of US$26m, and total annual CEO compensation was reported as US$396k for the year to January 2021. That's a notable decrease of 25% on last year. In particular, the salary of US$359.5k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$390k. From this we gather that Brendan Flood is paid around the median for CEOs in the industry. Furthermore, Brendan Flood directly owns US$249k worth of shares in the company.

Component	2021	2019	Proportion (2021)
Salary	US$360k	US$357k	91%
Other	US$36k	US$168k	9%
Total Compensation	US$396k	US$526k	100%

Speaking on an industry level, nearly 23% of total compensation represents salary, while the remainder of 77% is other remuneration. According to our research, Staffing 360 Solutions has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Staffing 360 Solutions, Inc.'s Growth Numbers

Staffing 360 Solutions, Inc. has seen its earnings per share (EPS) increase by 33% a year over the past three years. Its revenue is down 13% over the previous year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Staffing 360 Solutions, Inc. Been A Good Investment?

Few Staffing 360 Solutions, Inc. shareholders would feel satisfied with the return of -81% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. 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 4 warning signs for Staffing 360 Solutions you should be aware of, and 2 of them don't sit too well with us.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.
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