Here's Why Forward Industries, Inc.'s (NASDAQ:FORD) CEO May Not Expect A Pay Rise This Year

The underwhelming performance at Forward Industries, Inc. (NASDAQ:FORD) recently has probably not pleased shareholders. The next AGM coming up on 16 February 2022 will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. The data we gathered below shows that CEO compensation looks acceptable for now.

View our latest analysis for Forward Industries

How Does Total Compensation For Terry Wise Compare With Other Companies In The Industry?

At the time of writing, our data shows that Forward Industries, Inc. has a market capitalization of US$16m, and reported total annual CEO compensation of US$234k for the year to September 2021. Notably, that's a decrease of 42% over the year before. Notably, the salary which is US$225.0k, represents most of the total compensation being paid.

On comparing similar-sized companies in the industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$463k. This suggests that Terry Wise is paid below the industry median. Furthermore, Terry Wise directly owns US$2.6m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2021	2020	Proportion (2021)
Salary	US$225k	US$300k	96%
Other	US$9.0k	US$100k	4%
Total Compensation	US$234k	US$400k	100%

Talking in terms of the industry, salary represented approximately 23% of total compensation out of all the companies we analyzed, while other remuneration made up 77% of the pie. Forward Industries pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Forward Industries, Inc.'s Growth

Over the last three years, Forward Industries, Inc. has shrunk its earnings per share by 30% per year. Its revenue is up 13% over the last year.

Few shareholders would be pleased to read that EPS have declined. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for us to put aside my concerns around EPS. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Forward Industries, Inc. Been A Good Investment?

Given the total shareholder loss of 3.0% over three years, many shareholders in Forward Industries, Inc. are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Terry receives almost all of their compensation through a salary. Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a 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.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 3 warning signs for Forward Industries that you should be aware of before investing.

Important note: Forward Industries is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.