Shareholders Will Probably Not Have Any Issues With Utah Medical Products, Inc.'s (NASDAQ:UTMD) CEO Compensation

Shareholders may be wondering what CEO Kevin Cornwell plans to do to improve the less than great performance at Utah Medical Products, Inc. (NASDAQ:UTMD) recently. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 07 May 2021. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. In our opinion, CEO compensation does not look excessive and we discuss why.

See our latest analysis for Utah Medical Products

Comparing Utah Medical Products, Inc.'s CEO Compensation With the industry

According to our data, Utah Medical Products, Inc. has a market capitalization of US$318m, and paid its CEO total annual compensation worth US$327k over the year to December 2020. We note that's a decrease of 31% compared to last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$78k.

For comparison, other companies in the same industry with market capitalizations ranging between US$200m and US$800m had a median total CEO compensation of US$2.0m. Accordingly, Utah Medical Products pays its CEO under the industry median. What's more, Kevin Cornwell holds US$17m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2020	2019	Proportion (2020)
Salary	US$78k	US$156k	24%
Other	US$249k	US$318k	76%
Total Compensation	US$327k	US$474k	100%

Speaking on an industry level, nearly 19% of total compensation represents salary, while the remainder of 81% is other remuneration. Utah Medical Products pays out 24% of remuneration in the form of a salary, significantly higher than the industry average. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Utah Medical Products, Inc.'s Growth

Utah Medical Products, Inc.'s earnings per share (EPS) grew 6.4% per year over the last three years. Its revenue is down 10% over the previous year.

We would argue that the lack of revenue growth in the last year is less than ideal, but the modest improvement in EPS is good. It's hard to reach a conclusion about business performance right now. This may be one to watch. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Utah Medical Products, Inc. Been A Good Investment?

With a three year total loss of 13% for the shareholders, Utah Medical Products, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The lack lustre share price performance may have something to do with the flat earnings growth. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board and assess if the board's plan is likely to improve company performance.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 1 warning sign for Utah Medical Products that investors should be aware of in a dynamic business environment.

Switching gears from Utah Medical Products, 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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This article by Simply Wall St is general in nature. 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.
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