Yield10 Bioscience, Inc.'s (NASDAQ:YTEN) CEO Will Probably Find It Hard To See A Huge Raise This Year

The underwhelming share price performance of Yield10 Bioscience, Inc. (NASDAQ:YTEN) in the past three years would have disappointed many shareholders. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. The AGM coming up on the 24 May 2021 could be an opportunity for shareholders to bring these concerns to the board's attention. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Yield10 Bioscience

Comparing Yield10 Bioscience, Inc.'s CEO Compensation With the industry

Our data indicates that Yield10 Bioscience, Inc. has a market capitalization of US$36m, and total annual CEO compensation was reported as US$1.1m for the year to December 2020. That's a notable increase of 80% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$289k.

On comparing similar-sized companies in the industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$1.1m. So it looks like Yield10 Bioscience compensates Olly Peoples in line with the median for the industry. Moreover, Olly Peoples also holds US$66k worth of Yield10 Bioscience stock directly under their own name.

Component	2020	2019	Proportion (2020)
Salary	US$289k	US$275k	27%
Other	US$793k	US$325k	73%
Total Compensation	US$1.1m	US$600k	100%

On an industry level, roughly 19% of total compensation represents salary and 81% is other remuneration. Yield10 Bioscience is paying a higher share of its remuneration through a salary in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Yield10 Bioscience, Inc.'s Growth Numbers

Yield10 Bioscience, Inc. has seen its earnings per share (EPS) increase by 74% a year over the past three years. It saw its revenue drop 5.2% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Yield10 Bioscience, Inc. Been A Good Investment?

The return of -89% over three years would not have pleased Yield10 Bioscience, Inc. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

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 Yield10 Bioscience (2 shouldn't be ignored!) that you should be aware of before investing here.

Important note: Yield10 Bioscience 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.

When trading Yield10 Bioscience or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.