We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Bridgeline Digital, Inc.'s (NASDAQ:BLIN) CEO For Now

Key Insights

• Bridgeline Digital's Annual General Meeting to take place on 31st of July
• CEO Ari Kahn's total compensation includes salary of US$400.0k
• Total compensation is 36% above industry average
• Over the past three years, Bridgeline Digital's EPS grew by 7.5% and over the past three years, the total loss to shareholders 82%

In the past three years, the share price of Bridgeline Digital, Inc. (NASDAQ:BLIN) 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. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 31st of July. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. 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 Bridgeline Digital

How Does Total Compensation For Ari Kahn Compare With Other Companies In The Industry?

According to our data, Bridgeline Digital, Inc. has a market capitalization of US$10m, and paid its CEO total annual compensation worth US$851k over the year to September 2023. We note that's a decrease of 34% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$400k.

In comparison with other companies in the American Software industry with market capitalizations under US$200m, the reported median total CEO compensation was US$624k. Hence, we can conclude that Ari Kahn is remunerated higher than the industry median. What's more, Ari Kahn holds US$914k worth of shares in the company in their own name.

Component	2023	2022	Proportion (2023)
Salary	US$400k	US$339k	47%
Other	US$451k	US$947k	53%
Total Compensation	US$851k	US$1.3m	100%

Speaking on an industry level, nearly 15% of total compensation represents salary, while the remainder of 85% is other remuneration. According to our research, Bridgeline Digital has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Bridgeline Digital, Inc.'s Growth Numbers

Bridgeline Digital, Inc.'s earnings per share (EPS) grew 7.5% per year over the last three years. It saw its revenue drop 8.0% over the last year.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Bridgeline Digital, Inc. Been A Good Investment?

Few Bridgeline Digital, Inc. shareholders would feel satisfied with the return of -82% over three years. 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 be keen to know what's holding the stock back when earnings have grown. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 3 warning signs for Bridgeline Digital (1 is a bit unpleasant!) that you should be aware of before investing here.

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.

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