Hims & Hers Health, Inc.'s (NYSE:HIMS) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Hims & Hers Health's Annual General Meeting to take place on 6th of June
• Total pay for CEO Andrew Dudum includes US$612.0k salary
• The total compensation is 104% higher than the average for the industry
• Over the past three years, Hims & Hers Health's EPS grew by 64% and over the past three years, the total shareholder return was 46%

CEO Andrew Dudum has done a decent job of delivering relatively good performance at Hims & Hers Health, Inc. (NYSE:HIMS) recently. As shareholders go into the upcoming AGM on 6th of June, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Hims & Hers Health

Comparing Hims & Hers Health, Inc.'s CEO Compensation With The Industry

Our data indicates that Hims & Hers Health, Inc. has a market capitalization of US$4.4b, and total annual CEO compensation was reported as US$14m for the year to December 2023. We note that's an increase of 33% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$612k.

On examining similar-sized companies in the American Healthcare industry with market capitalizations between US$2.0b and US$6.4b, we discovered that the median CEO total compensation of that group was US$7.1m. This suggests that Andrew Dudum is paid more than the median for the industry. What's more, Andrew Dudum holds US$400m 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$612k	US$600k	4%
Other	US$14m	US$10m	96%
Total Compensation	US$14m	US$11m	100%

Talking in terms of the industry, salary represented approximately 21% of total compensation out of all the companies we analyzed, while other remuneration made up 79% of the pie. A high-salary is usually a no-brainer when it comes to attracting the best executives, but Hims & Hers Health paid Andrew Dudum a nominal salary to the CEO over the past 12 months, instead focusing on non-salary compensation. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Hims & Hers Health, Inc.'s Growth Numbers

Hims & Hers Health, Inc. has seen its earnings per share (EPS) increase by 64% a year over the past three years. In the last year, its revenue is up 56%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Hims & Hers Health, Inc. Been A Good Investment?

Boasting a total shareholder return of 46% over three years, Hims & Hers Health, Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Hims & Hers Health primarily uses non-salary benefits to reward its CEO. Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 2 warning signs for Hims & Hers Health that investors should look into moving forward.

Important note: Hims & Hers Health 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.