Fusen Chen became the CEO of Kulicke and Soffa Industries, Inc. (NASDAQ:KLIC) in 2016. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
View our latest analysis for Kulicke and Soffa Industries
How Does Fusen Chen’s Compensation Compare With Similar Sized Companies?
According to our data, Kulicke and Soffa Industries, Inc. has a market capitalization of US$1.5b, and pays its CEO total annual compensation worth US$5.1m. (This number is for the twelve months until September 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$650k. We looked at a group of companies with market capitalizations from US$1.0b to US$3.2b, and the median CEO total compensation was US$3.6m.
As you can see, Fusen Chen is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Kulicke and Soffa Industries, Inc. is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see a visual representation of the CEO compensation at Kulicke and Soffa Industries, below.
Is Kulicke and Soffa Industries, Inc. Growing?
Kulicke and Soffa Industries, Inc. has increased its earnings per share (EPS) by an average of 23% a year, over the last three years (using a line of best fit). Its revenue is down -4.6% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. The lack of revenue growth isn’t ideal, but it is the bottom line that counts most in business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Kulicke and Soffa Industries, Inc. Been A Good Investment?
Most shareholders would probably be pleased with Kulicke and Soffa Industries, Inc. for providing a total return of 104% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
In Summary…
We compared the total CEO remuneration paid by Kulicke and Soffa Industries, Inc., and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. On top of that, in the same period, returns to shareholders have been great. So, considering this good performance, the CEO compensation may be quite appropriate. Whatever your view on compensation, you might want to check if insiders are buying or selling Kulicke and Soffa Industries shares (free trial).
If you want to buy a stock that is better than Kulicke and Soffa Industries, this free list of high return, low debt companies is a great place to look.
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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.