Shareholders Will Likely Find Windtree Therapeutics, Inc.'s (NASDAQ:WINT) CEO Compensation Acceptable

Shareholders may be wondering what CEO Craig Fraser plans to do to improve the less than great performance at Windtree Therapeutics, Inc. (NASDAQ:WINT) recently. At the next AGM coming up on 16 June 2021, they can influence managerial decision making through voting on resolutions, including executive remuneration. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We have prepared some analysis below to show that CEO compensation looks to be reasonable.

See our latest analysis for Windtree Therapeutics

Comparing Windtree Therapeutics, Inc.'s CEO Compensation With the industry

At the time of writing, our data shows that Windtree Therapeutics, Inc. has a market capitalization of US$67m, and reported total annual CEO compensation of US$770k for the year to December 2020. That's a notable decrease of 28% on last year. We note that the salary of US$460.3k makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$1.1m. In other words, Windtree Therapeutics pays its CEO lower than the industry median. Furthermore, Craig Fraser directly owns US$75k worth of shares in the company.

Component	2020	2019	Proportion (2020)
Salary	US$460k	US$452k	60%
Other	US$310k	US$611k	40%
Total Compensation	US$770k	US$1.1m	100%

On an industry level, roughly 20% of total compensation represents salary and 80% is other remuneration. Windtree Therapeutics pays out 60% of remuneration in the form of a salary, significantly higher than the industry average. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Windtree Therapeutics, Inc.'s Growth Numbers

Over the past three years, Windtree Therapeutics, Inc. has seen its earnings per share (EPS) grow by 86% per year. In the last year, its revenue has collapsed effectively to zero.

Shareholders would be glad to know that the company has improved itself over the last few years. While it would be good to see revenue growth, profits matter more in the end. 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 Windtree Therapeutics, Inc. Been A Good Investment?

The return of -79% over three years would not have pleased Windtree Therapeutics, Inc. shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

The loss to shareholders over the past three years is certainly concerning. This diverges with the robust growth in EPS, suggesting that there is a large discrepancy between share price and fundamentals. A key focus for the board and management will be how to align the share price with fundamentals. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board’s judgement and decision-making is aligned with their expectations.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 5 warning signs for Windtree Therapeutics (2 are significant!) that you should be aware of before investing here.

Important note: Windtree Therapeutics 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. 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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