Shareholders May Not Be So Generous With indie Semiconductor, Inc.'s (NASDAQ:INDI) CEO Compensation And Here's Why

Key Insights

• indie Semiconductor will host its Annual General Meeting on 13th of June
• Total pay for CEO Donald McClymont includes US$400.0k salary
• The total compensation is similar to the average for the industry
• indie Semiconductor's three-year loss to shareholders was 29% while its EPS grew by 44% over the past three years

In the past three years, the share price of indie Semiconductor, Inc. (NASDAQ:INDI) has struggled to grow and now shareholders are sitting on a loss. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. The AGM coming up on the 13th of June could be an opportunity for shareholders to bring these concerns to the board's attention. They could also influence management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

See our latest analysis for indie Semiconductor

How Does Total Compensation For Donald McClymont Compare With Other Companies In The Industry?

According to our data, indie Semiconductor, Inc. has a market capitalization of US$1.5b, and paid its CEO total annual compensation worth US$4.5m over the year to December 2023. That's a notable increase of 87% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$400k.

For comparison, other companies in the American Semiconductor industry with market capitalizations ranging between US$1.0b and US$3.2b had a median total CEO compensation of US$5.7m. From this we gather that Donald McClymont is paid around the median for CEOs in the industry. What's more, Donald McClymont holds US$1.2m worth of shares in the company in their own name.

Component	2023	2022	Proportion (2023)
Salary	US$400k	US$400k	9%
Other	US$4.1m	US$2.0m	91%
Total Compensation	US$4.5m	US$2.4m	100%

On an industry level, around 11% of total compensation represents salary and 89% is other remuneration. In indie Semiconductor's 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.

indie Semiconductor, Inc.'s Growth

indie Semiconductor, Inc.'s earnings per share (EPS) grew 44% per year over the last three years. Its revenue is up 82% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 indie Semiconductor, Inc. Been A Good Investment?

With a three year total loss of 29% for the shareholders, indie Semiconductor, Inc. would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. 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.

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 indie Semiconductor 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.

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

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.