Stock Analysis

Here's Why Capricor Therapeutics, Inc.'s (NASDAQ:CAPR) CEO May Have Their Pay Bumped Up

NasdaqCM:CAPR
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Key Insights

The decent performance at Capricor Therapeutics, Inc. (NASDAQ:CAPR) recently will please most shareholders as they go into the AGM coming up on 14th of May. The focus will probably be on the future strategic initiatives that the board and management will put in place to improve the business rather than executive remuneration when they cast their votes on company resolutions. We have prepared some analysis below and we show why we think CEO compensation looks decent with even the possibility for a raise.

View our latest analysis for Capricor Therapeutics

Comparing Capricor Therapeutics, Inc.'s CEO Compensation With The Industry

According to our data, Capricor Therapeutics, Inc. has a market capitalization of US$172m, and paid its CEO total annual compensation worth US$747k over the year to December 2023. Notably, that's a decrease of 44% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$221k.

In comparison with other companies in the American Biotechs industry with market capitalizations ranging from US$100m to US$400m, the reported median CEO total compensation was US$2.7m. In other words, Capricor Therapeutics pays its CEO lower than the industry median. Furthermore, Linda Marbán directly owns US$1.1m worth of shares in the company, implying that they are deeply invested in the company's success.

Component20232022Proportion (2023)
Salary US$221k US$210k 30%
Other US$527k US$1.1m 70%
Total CompensationUS$747k US$1.3m100%

Talking in terms of the industry, salary represented approximately 23% of total compensation out of all the companies we analyzed, while other remuneration made up 77% of the pie. Capricor Therapeutics pays out 30% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
NasdaqCM:CAPR CEO Compensation May 8th 2024

Capricor Therapeutics, Inc.'s Growth

Over the last three years, Capricor Therapeutics, Inc. has shrunk its earnings per share by 9.6% per year. It achieved revenue growth of 887% over the last year.

Investors would be a bit wary of companies that have lower EPS On the other hand, the strong revenue growth suggests the business is growing. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 Capricor Therapeutics, Inc. Been A Good Investment?

We think that the total shareholder return of 55%, over three years, would leave most Capricor Therapeutics, Inc. shareholders smiling. 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...

While the company seems to be headed in the right direction performance-wise, there's always room for improvement. If it manages to keep up the current streak, CEO remuneration could well be one of shareholders' least concerns. Rather, investors would more likely want to engage on discussions related to key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Capricor Therapeutics that you should be aware of before investing.

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.

Valuation is complex, but we're helping make it simple.

Find out whether Capricor Therapeutics is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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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.