It's Unlikely That Universal Electronics Inc.'s (NASDAQ:UEIC) CEO Will See A Huge Pay Rise This Year

By
Simply Wall St
Published
June 01, 2021
NasdaqGS:UEIC
Source: Shutterstock

Performance at Universal Electronics Inc. (NASDAQ:UEIC) has been reasonably good and CEO Paul Arling has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 08 June 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Universal Electronics

How Does Total Compensation For Paul Arling Compare With Other Companies In The Industry?

According to our data, Universal Electronics Inc. has a market capitalization of US$688m, and paid its CEO total annual compensation worth US$3.6m over the year to December 2020. That's a slight decrease of 5.9% on the prior year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$830k.

On comparing similar companies from the same industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$1.9m. Hence, we can conclude that Paul Arling is remunerated higher than the industry median. What's more, Paul Arling holds US$11m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component20202019Proportion (2020)
Salary US$830k US$830k 23%
Other US$2.8m US$3.0m 77%
Total CompensationUS$3.6m US$3.8m100%

Speaking on an industry level, nearly 24% of total compensation represents salary, while the remainder of 76% is other remuneration. Although there is a difference in how total compensation is set, Universal Electronics more or less reflects the market in terms of setting the salary. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
NasdaqGS:UEIC CEO Compensation June 2nd 2021

A Look at Universal Electronics Inc.'s Growth Numbers

Universal Electronics Inc. has seen its earnings per share (EPS) increase by 79% a year over the past three years. Its revenue is down 15% over the previous year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. 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 Universal Electronics Inc. Been A Good Investment?

Most shareholders would probably be pleased with Universal Electronics Inc. for providing a total return of 61% 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...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

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 Universal Electronics that investors should think about before committing capital to this stock.

Switching gears from Universal Electronics, 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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