Here's Why Nature's Sunshine Products, Inc.'s (NASDAQ:NATR) CEO May Not Expect A Pay Rise This Year

Key Insights

• Nature's Sunshine Products' Annual General Meeting to take place on 1st of May
• Salary of US$800.0k is part of CEO Terrence Moorehead's total remuneration
• The overall pay is 39% below the industry average
• Nature's Sunshine Products' EPS declined by 9.8% over the past three years while total shareholder loss over the past three years was 2.5%

The underwhelming performance at Nature's Sunshine Products, Inc. (NASDAQ:NATR) recently has probably not pleased shareholders. At the upcoming AGM on 1st of May, shareholders may have the opportunity to influence management to turn the performance around by voting on resolutions such as executive remuneration and other matters. The data we gathered below shows that CEO compensation looks acceptable for now.

See our latest analysis for Nature's Sunshine Products

How Does Total Compensation For Terrence Moorehead Compare With Other Companies In The Industry?

Our data indicates that Nature's Sunshine Products, Inc. has a market capitalization of US$372m, and total annual CEO compensation was reported as US$3.5m for the year to December 2023. We note that's an increase of 26% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$800k.

On comparing similar companies from the American Personal Products industry with market caps ranging from US$200m to US$800m, we found that the median CEO total compensation was US$5.8m. Accordingly, Nature's Sunshine Products pays its CEO under the industry median. What's more, Terrence Moorehead holds US$7.4m 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$800k	US$724k	23%
Other	US$2.7m	US$2.1m	77%
Total Compensation	US$3.5m	US$2.8m	100%

Speaking on an industry level, nearly 66% of total compensation represents salary, while the remainder of 34% is other remuneration. Nature's Sunshine Products sets aside a smaller share of compensation for salary, in comparison to the overall 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 Nature's Sunshine Products, Inc.'s Growth Numbers

Over the last three years, Nature's Sunshine Products, Inc. has shrunk its earnings per share by 9.8% per year. It achieved revenue growth of 5.5% over the last year.

Few shareholders would be pleased to read that EPS have declined. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Nature's Sunshine Products, Inc. Been A Good Investment?

With a three year total loss of 2.5% for the shareholders, Nature's Sunshine Products, Inc. would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 1 warning sign for Nature's Sunshine Products that investors should be aware of in a dynamic business environment.

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.