Here's Why It's Unlikely That Fulgent Genetics, Inc.'s (NASDAQ:FLGT) CEO Will See A Pay Rise This Year

Key Insights

• Fulgent Genetics will host its Annual General Meeting on 15th of May
• Total pay for CEO Ming Hsieh includes US$1.00m salary
• The overall pay is 82% above the industry average
• Over the past three years, Fulgent Genetics' EPS fell by 109% and over the past three years, the total loss to shareholders 64%

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Fulgent Genetics, Inc. (NASDAQ:FLGT) has not performed well recently and CEO Ming Hsieh will probably need to up their game. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 15th of May. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for Fulgent Genetics

How Does Total Compensation For Ming Hsieh Compare With Other Companies In The Industry?

According to our data, Fulgent Genetics, Inc. has a market capitalization of US$568m, and paid its CEO total annual compensation worth US$6.1m over the year to December 2024. That's a notable increase of 15% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.0m.

On examining similar-sized companies in the American Healthcare industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$3.4m. Accordingly, our analysis reveals that Fulgent Genetics, Inc. pays Ming Hsieh north of the industry median. Moreover, Ming Hsieh also holds US$163m worth of Fulgent Genetics stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	US$1.0m	US$1.0m	16%
Other	US$5.1m	US$4.3m	84%
Total Compensation	US$6.1m	US$5.3m	100%

On an industry level, roughly 15% of total compensation represents salary and 85% is other remuneration. Our data reveals that Fulgent Genetics allocates salary more or less in line with the wider market. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Fulgent Genetics, Inc.'s Growth Numbers

Fulgent Genetics, Inc. has reduced its earnings per share by 109% a year over the last three years. It achieved revenue growth of 1.7% over the last year.

Overall this is not a very positive result for shareholders. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Fulgent Genetics, Inc. Been A Good Investment?

Few Fulgent Genetics, Inc. shareholders would feel satisfied with the return of -64% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 1 warning sign for Fulgent Genetics that investors should look into moving forward.

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.