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

Key Insights

• LENSAR to hold its Annual General Meeting on 7th of May
• Salary of US$541.1k is part of CEO Nick Curtis's total remuneration
• The overall pay is 78% above the industry average
• LENSAR's three-year loss to shareholders was 57% while its EPS grew by 33% over the past three years

The underwhelming share price performance of LENSAR, Inc. (NASDAQ:LNSR) in the past three years would have disappointed many shareholders. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. These are some of the concerns that shareholders may want to bring up at the next AGM held on 7th of May. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

See our latest analysis for LENSAR

How Does Total Compensation For Nick Curtis Compare With Other Companies In The Industry?

Our data indicates that LENSAR, Inc. has a market capitalization of US$36m, and total annual CEO compensation was reported as US$1.2m for the year to December 2023. Notably, that's a decrease of 20% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$541k.

In comparison with other companies in the American Medical Equipment industry with market capitalizations under US$200m, the reported median total CEO compensation was US$655k. Accordingly, our analysis reveals that LENSAR, Inc. pays Nick Curtis north of the industry median. What's more, Nick Curtis holds US$2.4m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	US$541k	US$518k	46%
Other	US$626k	US$943k	54%
Total Compensation	US$1.2m	US$1.5m	100%

On an industry level, roughly 26% of total compensation represents salary and 74% is other remuneration. It's interesting to note that LENSAR pays out a greater portion of remuneration through salary, compared to the industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at LENSAR, Inc.'s Growth Numbers

Over the past three years, LENSAR, Inc. has seen its earnings per share (EPS) grow by 33% per year. It achieved revenue growth of 19% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. 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 LENSAR, Inc. Been A Good Investment?

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

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. 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.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 4 warning signs for LENSAR that investors should be aware of in a dynamic business environment.

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.