This Is Why Coupang, Inc.'s (NYSE:CPNG) CEO Compensation Looks Appropriate

Key Insights

• Coupang to hold its Annual General Meeting on 14th of June
• CEO Bom Suk Kim's total compensation includes salary of US$1.10m
• The overall pay is 79% below the industry average
• Coupang's EPS grew by 132% over the past three years while total shareholder loss over the past three years was 43%

Performance at Coupang, Inc. (NYSE:CPNG) has been rather uninspiring recently and shareholders may be wondering how CEO Bom Suk Kim plans to fix this. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 14th of June. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We think CEO compensation looks appropriate given the data we have put together.

View our latest analysis for Coupang

Comparing Coupang, Inc.'s CEO Compensation With The Industry

Our data indicates that Coupang, Inc. has a market capitalization of US$39b, and total annual CEO compensation was reported as US$1.7m for the year to December 2023. Notably, that's a decrease of 10% over the year before. In particular, the salary of US$1.10m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the American Multiline Retail industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$8.3m. Accordingly, Coupang pays its CEO under the industry median. Moreover, Bom Suk Kim also holds US$3.8b worth of Coupang stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	US$1.1m	US$1.1m	64%
Other	US$631k	US$831k	36%
Total Compensation	US$1.7m	US$1.9m	100%

Speaking on an industry level, nearly 17% of total compensation represents salary, while the remainder of 83% is other remuneration. Coupang is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Coupang, Inc.'s Growth

Over the past three years, Coupang, Inc. has seen its earnings per share (EPS) grow by 132% per year. In the last year, its revenue is up 21%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Coupang, Inc. Been A Good Investment?

With a total shareholder return of -43% over three years, Coupang, Inc. shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

The loss to shareholders over the past three years is certainly concerning. The share price trend has diverged with the robust growth in EPS however, suggesting there may be other factors that could be driving the price performance. There needs to be more focus by management and the board to examine why the share price has diverged from 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.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Coupang that investors should be aware of in a dynamic business environment.

Switching gears from Coupang, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.