Koss Corporation's (NASDAQ:KOSS) CEO Looks Like They Deserve Their Pay Packet

The performance at Koss Corporation (NASDAQ:KOSS) has been quite strong recently and CEO Michael Koss has played a role in it. Coming up to the next AGM on 13 October 2021, shareholders would be keeping this in mind. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

View our latest analysis for Koss

How Does Total Compensation For Michael Koss Compare With Other Companies In The Industry?

Our data indicates that Koss Corporation has a market capitalization of US$139m, and total annual CEO compensation was reported as US$549k for the year to June 2021. That is, the compensation was roughly the same as last year. Notably, the salary which is US$325.0k, represents a considerable chunk of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$549k. This suggests that Koss remunerates its CEO largely in line with the industry average. What's more, Michael Koss holds US$396k worth of shares in the company in their own name.

Component	2021	2020	Proportion (2021)
Salary	US$325k	US$325k	59%
Other	US$224k	US$228k	41%
Total Compensation	US$549k	US$553k	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. It's interesting to note that Koss pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Koss Corporation's Growth

Over the past three years, Koss Corporation has seen its earnings per share (EPS) grow by 110% per year. It achieved revenue growth of 6.7% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Koss Corporation Been A Good Investment?

Most shareholders would probably be pleased with Koss Corporation for providing a total return of 479% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

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.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 3 warning signs for Koss that investors should look into moving forward.

Important note: Koss 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.

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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