We Take A Look At Why Merit Medical Systems, Inc.'s (NASDAQ:MMSI) CEO Has Earned Their Pay Packet

Key Insights

• Merit Medical Systems will host its Annual General Meeting on 14th of May
• CEO Fred Lampropoulos' total compensation includes salary of US$1.89m
• The overall pay is comparable to the industry average
• Merit Medical Systems' total shareholder return over the past three years was 61% while its EPS grew by 34% over the past three years

We've discovered 1 warning sign about Merit Medical Systems. View them for free.

It would be hard to discount the role that CEO Fred Lampropoulos has played in delivering the impressive results at Merit Medical Systems, Inc. (NASDAQ:MMSI) recently. Coming up to the next AGM on 14th of May, shareholders would be keeping this in mind. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

Check out our latest analysis for Merit Medical Systems

How Does Total Compensation For Fred Lampropoulos Compare With Other Companies In The Industry?

According to our data, Merit Medical Systems, Inc. has a market capitalization of US$5.6b, and paid its CEO total annual compensation worth US$10m over the year to December 2024. That's a modest increase of 3.3% on the prior year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.9m.

On comparing similar companies from the American Medical Equipment industry with market caps ranging from US$4.0b to US$12b, we found that the median CEO total compensation was US$9.3m. From this we gather that Fred Lampropoulos is paid around the median for CEOs in the industry. Moreover, Fred Lampropoulos also holds US$107m worth of Merit Medical Systems 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$1.9m	US$1.9m	18%
Other	US$8.5m	US$8.2m	82%
Total Compensation	US$10m	US$10m	100%

Talking in terms of the industry, salary represented approximately 25% of total compensation out of all the companies we analyzed, while other remuneration made up 75% of the pie. Merit Medical Systems pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Merit Medical Systems, Inc.'s Growth

Over the past three years, Merit Medical Systems, Inc. has seen its earnings per share (EPS) grow by 34% per year. Its revenue is up 8.2% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Merit Medical Systems, Inc. Been A Good Investment?

We think that the total shareholder return of 61%, over three years, would leave most Merit Medical Systems, Inc. shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

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 Merit Medical Systems that investors should look into moving forward.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.