We Think Charles River Laboratories International, Inc.'s (NYSE:CRL) CEO Compensation Package Needs To Be Put Under A Microscope

Key Insights

• Charles River Laboratories International to hold its Annual General Meeting on 20th of May
• CEO Jim Foster's total compensation includes salary of US$1.51m
• Total compensation is 63% above industry average
• Over the past three years, Charles River Laboratories International's EPS fell by 30% and over the past three years, the total loss to shareholders 39%

We've discovered 2 warning signs about Charles River Laboratories International. View them for free.

The results at Charles River Laboratories International, Inc. (NYSE:CRL) have been quite disappointing recently and CEO Jim Foster bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 20th of May. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for Charles River Laboratories International

How Does Total Compensation For Jim Foster Compare With Other Companies In The Industry?

Our data indicates that Charles River Laboratories International, Inc. has a market capitalization of US$7.0b, and total annual CEO compensation was reported as US$13m for the year to December 2024. That's slightly lower by 4.4% over the previous year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.5m.

On examining similar-sized companies in the American Life Sciences industry with market capitalizations between US$4.0b and US$12b, we discovered that the median CEO total compensation of that group was US$8.3m. This suggests that Jim Foster is paid more than the median for the industry. Moreover, Jim Foster also holds US$36m worth of Charles River Laboratories International stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	US$1.5m	US$1.5m	11%
Other	US$12m	US$13m	89%
Total Compensation	US$13m	US$14m	100%

Speaking on an industry level, nearly 14% of total compensation represents salary, while the remainder of 86% is other remuneration. In Charles River Laboratories International's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Charles River Laboratories International, Inc.'s Growth

Over the last three years, Charles River Laboratories International, Inc. has shrunk its earnings per share by 30% per year. In the last year, its revenue is down 2.2%.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. 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 Charles River Laboratories International, Inc. Been A Good Investment?

Few Charles River Laboratories International, Inc. shareholders would feel satisfied with the return of -39% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

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.

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 2 warning signs for Charles River Laboratories International that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.