It Looks Like Shareholders Would Probably Approve Potbelly Corporation's (NASDAQ:PBPB) CEO Compensation Package

Key Insights

• Potbelly will host its Annual General Meeting on 15th of May
• CEO Bob Wright's total compensation includes salary of US$743.3k
• The overall pay is comparable to the industry average
• Potbelly's EPS grew by 117% over the past three years while total shareholder return over the past three years was 50%

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The performance at Potbelly Corporation (NASDAQ:PBPB) has been quite strong recently and CEO Bob Wright has played a role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 15th of May. The focus will probably be on the future company strategy as shareholders 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.

Check out our latest analysis for Potbelly

Comparing Potbelly Corporation's CEO Compensation With The Industry

At the time of writing, our data shows that Potbelly Corporation has a market capitalization of US$255m, and reported total annual CEO compensation of US$3.0m for the year to December 2024. That's a notable decrease of 21% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$743k.

In comparison with other companies in the American Hospitality industry with market capitalizations ranging from US$100m to US$400m, the reported median CEO total compensation was US$2.4m. This suggests that Potbelly remunerates its CEO largely in line with the industry average. Furthermore, Bob Wright directly owns US$5.6m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	US$743k	US$724k	25%
Other	US$2.2m	US$3.0m	75%
Total Compensation	US$3.0m	US$3.8m	100%

Speaking on an industry level, nearly 17% of total compensation represents salary, while the remainder of 83% is other remuneration. Potbelly is paying a higher share of its remuneration through a salary in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Potbelly Corporation's Growth

Potbelly Corporation has seen its earnings per share (EPS) increase by 117% a year over the past three years. In the last year, its revenue is down 5.8%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Potbelly Corporation Been A Good Investment?

Most shareholders would probably be pleased with Potbelly Corporation for providing a total return of 50% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 2 warning signs for Potbelly that investors should be aware of in a dynamic business environment.

Switching gears from Potbelly, 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.