It Looks Like Stoke Therapeutics, Inc.'s (NASDAQ:STOK) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• Stoke Therapeutics' Annual General Meeting to take place on 5th of June
• CEO Ed Kaye's total compensation includes salary of US$625.9k
• Total compensation is similar to the industry average
• Stoke Therapeutics' EPS declined by 8.1% over the past three years while total shareholder loss over the past three years was 64%

Stoke Therapeutics, Inc. (NASDAQ:STOK) has not performed well recently and CEO Ed Kaye will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 5th of June. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for Stoke Therapeutics

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

According to our data, Stoke Therapeutics, Inc. has a market capitalization of US$733m, and paid its CEO total annual compensation worth US$3.5m over the year to December 2023. That's a notable decrease of 39% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$626k.

In comparison with other companies in the American Biotechs industry with market capitalizations ranging from US$400m to US$1.6b, the reported median CEO total compensation was US$4.3m. So it looks like Stoke Therapeutics compensates Ed Kaye in line with the median for the industry. Moreover, Ed Kaye also holds US$372k worth of Stoke Therapeutics stock directly under their own name.

Component	2023	2022	Proportion (2023)
Salary	US$626k	US$596k	18%
Other	US$2.9m	US$5.2m	82%
Total Compensation	US$3.5m	US$5.7m	100%

On an industry level, roughly 23% of total compensation represents salary and 77% is other remuneration. In Stoke Therapeutics' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Stoke Therapeutics, Inc.'s Growth

Stoke Therapeutics, Inc. has reduced its earnings per share by 8.1% a year over the last three years. In the last year, its revenue is down 46%.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Stoke Therapeutics, Inc. Been A Good Investment?

Few Stoke Therapeutics, Inc. shareholders would feel satisfied with the return of -64% over three years. This suggests it would be unwise for the company to pay the CEO too 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.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for Stoke Therapeutics you should be aware of, and 1 of them can't be ignored.

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.