Increases to CEO Compensation Might Be Put On Hold For Now at Weis Markets, Inc. (NYSE:WMK)

Key Insights

• Weis Markets' Annual General Meeting to take place on 2nd of May
• Salary of US$1.26m is part of CEO Jonathan Weis's total remuneration
• The total compensation is 58% higher than the average for the industry
• Over the past three years, Weis Markets' EPS fell by 4.4% and over the past three years, the total shareholder return was 30%

Despite positive share price growth of 30% for Weis Markets, Inc. (NYSE:WMK) over the last few years, earnings growth has been disappointing, which suggests something is amiss. The upcoming AGM on 2nd of May may be an opportunity for shareholders to bring up any concerns they may have for the board’s attention. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.

Check out our latest analysis for Weis Markets

Comparing Weis Markets, Inc.'s CEO Compensation With The Industry

At the time of writing, our data shows that Weis Markets, Inc. has a market capitalization of US$1.7b, and reported total annual CEO compensation of US$9.9m for the year to December 2023. That is, the compensation was roughly the same as last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.3m.

On comparing similar companies from the American Consumer Retailing industry with market caps ranging from US$1.0b to US$3.2b, we found that the median CEO total compensation was US$6.2m. Accordingly, our analysis reveals that Weis Markets, Inc. pays Jonathan Weis north of the industry median. Moreover, Jonathan Weis also holds US$673m worth of Weis Markets stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	US$1.3m	US$1.2m	13%
Other	US$8.6m	US$8.9m	87%
Total Compensation	US$9.9m	US$10m	100%

On an industry level, around 12% of total compensation represents salary and 88% is other remuneration. There isn't a significant difference between Weis Markets and the broader market, in terms of salary allocation in the overall compensation package. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Weis Markets, Inc.'s Growth Numbers

Over the last three years, Weis Markets, Inc. has shrunk its earnings per share by 4.4% per year. In the last year, its revenue changed by just 0.06%.

Few shareholders would be pleased to read that EPS have declined. And the flat revenue hardly impresses. These factors suggest that the business performance wouldn't really justify a high pay packet 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 Weis Markets, Inc. Been A Good Investment?

With a total shareholder return of 30% over three years, Weis Markets, Inc. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

Despite the positive returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about whether these returns will continue. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.

Shareholders may want to check for free if Weis Markets insiders are buying or selling shares.

Switching gears from Weis Markets, 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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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.