Why We Think Shareholders May Be Considering Bumping Up ClearPoint Neuro, Inc.'s (NASDAQ:CLPT) CEO Compensation

By
Simply Wall St
Published
May 27, 2021
NasdaqCM:CLPT
Source: Shutterstock

The impressive results at ClearPoint Neuro, Inc. (NASDAQ:CLPT) recently will be great news for shareholders. This would be kept in mind at the upcoming AGM on 03 June 2021 which will be a chance for them to hear the board review the financial results, discuss future company strategy and vote on resolutions such as executive remuneration and other matters. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

View our latest analysis for ClearPoint Neuro

How Does Total Compensation For Joe Burnett Compare With Other Companies In The Industry?

At the time of writing, our data shows that ClearPoint Neuro, Inc. has a market capitalization of US$371m, and reported total annual CEO compensation of US$797k for the year to December 2020. That's a slight decrease of 7.8% on the prior year. We note that the salary of US$435.0k makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from US$200m to US$800m, the reported median CEO total compensation was US$1.7m. In other words, ClearPoint Neuro pays its CEO lower than the industry median. Moreover, Joe Burnett also holds US$4.7m worth of ClearPoint Neuro stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component20202019Proportion (2020)
Salary US$435k US$366k 55%
Other US$362k US$498k 45%
Total CompensationUS$797k US$864k100%

Speaking on an industry level, nearly 22% of total compensation represents salary, while the remainder of 78% is other remuneration. ClearPoint Neuro is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

ceo-compensation
NasdaqCM:CLPT CEO Compensation May 27th 2021

ClearPoint Neuro, Inc.'s Growth

ClearPoint Neuro, Inc.'s earnings per share (EPS) grew 19% per year over the last three years. Its revenue is up 16% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 ClearPoint Neuro, Inc. Been A Good Investment?

Boasting a total shareholder return of 750% over three years, ClearPoint Neuro, Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. However, despite the strong growth in earnings and share price growth, the focus for shareholders would be how the company plans to steer the company towards sustainable profitability in the near future.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 3 warning signs for ClearPoint Neuro that investors should think about before committing capital to this stock.

Switching gears from ClearPoint Neuro, 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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