We Think Some Shareholders May Hesitate To Increase SuRo Capital Corp.'s (NASDAQ:SSSS) CEO Compensation

Key Insights

• SuRo Capital to hold its Annual General Meeting on 5th of June
• Salary of US$850.0k is part of CEO Mark Klein's total remuneration
• Total compensation is 386% above industry average
• SuRo Capital's EPS declined by 99% over the past three years while total shareholder loss over the past three years was 57%

The underwhelming share price performance of SuRo Capital Corp. (NASDAQ:SSSS) in the past three years would have disappointed many shareholders. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. Shareholders will have a chance to take their concerns to the board at the next AGM on 5th of June and vote on resolutions including executive compensation, which studies show may have an impact on company performance. Here's why we think shareholders should hold off on a raise for the CEO at the moment.

See our latest analysis for SuRo Capital

Comparing SuRo Capital Corp.'s CEO Compensation With The Industry

At the time of writing, our data shows that SuRo Capital Corp. has a market capitalization of US$97m, and reported total annual CEO compensation of US$3.0m for the year to December 2023. That's a notable decrease of 32% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$850k.

On comparing similar-sized companies in the American Capital Markets industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$612k. This suggests that Mark Klein is paid more than the median for the industry. Furthermore, Mark Klein directly owns US$4.4m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	US$850k	US$850k	29%
Other	US$2.1m	US$3.5m	71%
Total Compensation	US$3.0m	US$4.4m	100%

On an industry level, roughly 10% of total compensation represents salary and 90% is other remuneration. SuRo Capital 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.

SuRo Capital Corp.'s Growth

Over the last three years, SuRo Capital Corp. has shrunk its earnings per share by 99% per year. In the last year, its revenue is up 64%.

The reduction in EPS, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has SuRo Capital Corp. Been A Good Investment?

With a total shareholder return of -57% over three years, SuRo Capital Corp. shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The returns to shareholders is disappointing along with lack of earnings growth, which goes some way in explaining the poor returns. Shareholders will get the chance at the upcoming AGM to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

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 1 warning sign for SuRo Capital that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.