Here's Why Shareholders May Want To Be Cautious With Increasing LogicMark, Inc.'s (NASDAQ:LGMK) CEO Pay Packet

Key Insights

• LogicMark to hold its Annual General Meeting on 20th of December
• Salary of US$475.5k is part of CEO Chia-Lin Simmons's total remuneration
• The overall pay is 101% above the industry average
• LogicMark's EPS grew by 31% over the past three years while total shareholder loss over the past three years was 99%

The underwhelming share price performance of LogicMark, Inc. (NASDAQ:LGMK) in the past three years would have disappointed many shareholders. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 20th of December. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

See our latest analysis for LogicMark

Comparing LogicMark, Inc.'s CEO Compensation With The Industry

Our data indicates that LogicMark, Inc. has a market capitalization of US$2.1m, and total annual CEO compensation was reported as US$1.4m for the year to December 2022. We note that's a decrease of 63% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$475k.

For comparison, other companies in the American Medical Equipment industry with market capitalizations below US$200m, reported a median total CEO compensation of US$717k. Accordingly, our analysis reveals that LogicMark, Inc. pays Chia-Lin Simmons north of the industry median. What's more, Chia-Lin Simmons holds US$84k worth of shares in the company in their own name.

Component	2022	2021	Proportion (2022)
Salary	US$475k	US$243k	33%
Other	US$965k	US$3.6m	67%
Total Compensation	US$1.4m	US$3.9m	100%

On an industry level, around 27% of total compensation represents salary and 73% is other remuneration. LogicMark pays out 33% of remuneration in the form of a salary, significantly higher than the industry average. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

LogicMark, Inc.'s Growth

LogicMark, Inc. has seen its earnings per share (EPS) increase by 31% a year over the past three years. Its revenue is down 21% over the previous year.

Shareholders would be glad to know that the company has improved itself over the last few years. While it would be good to see revenue growth, profits matter more in the end. 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 LogicMark, Inc. Been A Good Investment?

With a total shareholder return of -99% over three years, LogicMark, Inc. shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 6 warning signs for LogicMark (of which 4 are significant!) that you should know about in order to have a holistic understanding of the stock.

Important note: LogicMark is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.