The Dixie Group, Inc.'s (NASDAQ:DXYN) CEO Might Not Expect Shareholders To Be So Generous This Year

Key Insights

• Dixie Group's Annual General Meeting to take place on 1st of May
• Total pay for CEO Dan Frierson includes US$625.0k salary
• The overall pay is 90% above the industry average
• Dixie Group's three-year loss to shareholders was 85% while its EPS was down 61% over the past three years

The Dixie Group, Inc. (NASDAQ:DXYN) has not performed well recently and CEO Dan Frierson will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 1st of May. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for Dixie Group

How Does Total Compensation For Dan Frierson Compare With Other Companies In The Industry?

Our data indicates that The Dixie Group, Inc. has a market capitalization of US$7.8m, and total annual CEO compensation was reported as US$1.2m for the year to December 2023. We note that's an increase of 19% above last year. We note that the salary of US$625.0k makes up a sizeable portion of the total compensation received by the CEO.

For comparison, other companies in the American Consumer Durables industry with market capitalizations below US$200m, reported a median total CEO compensation of US$610k. Hence, we can conclude that Dan Frierson is remunerated higher than the industry median. Moreover, Dan Frierson also holds US$544k worth of Dixie Group stock directly under their own name.

Component	2023	2022	Proportion (2023)
Salary	US$625k	US$625k	54%
Other	US$536k	US$351k	46%
Total Compensation	US$1.2m	US$976k	100%

Talking in terms of the industry, salary represented approximately 18% of total compensation out of all the companies we analyzed, while other remuneration made up 82% of the pie. Dixie Group is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at The Dixie Group, Inc.'s Growth Numbers

Over the last three years, The Dixie Group, Inc. has shrunk its earnings per share by 61% per year. It saw its revenue drop 9.0% over the last year.

Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has The Dixie Group, Inc. Been A Good Investment?

The return of -85% over three years would not have pleased The Dixie Group, Inc. shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 3 warning signs for Dixie Group (of which 2 can't be ignored!) that you should know about in order to have a holistic understanding of the stock.

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.