Shareholders May Be Wary Of Increasing Rimini Street, Inc.'s (NASDAQ:RMNI) CEO Compensation Package

Key Insights

• Rimini Street's Annual General Meeting to take place on 4th of June
• CEO Seth Ravin's total compensation includes salary of US$491.7k
• Total compensation is similar to the industry average
• Rimini Street's EPS declined by 102% over the past three years while total shareholder loss over the past three years was 52%

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The results at Rimini Street, Inc. (NASDAQ:RMNI) have been quite disappointing recently and CEO Seth Ravin bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 4th of June. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for Rimini Street

How Does Total Compensation For Seth Ravin Compare With Other Companies In The Industry?

At the time of writing, our data shows that Rimini Street, Inc. has a market capitalization of US$311m, and reported total annual CEO compensation of US$3.7m for the year to December 2024. We note that's a decrease of 21% compared to last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$492k.

On comparing similar companies from the American Software industry with market caps ranging from US$200m to US$800m, we found that the median CEO total compensation was US$4.8m. So it looks like Rimini Street compensates Seth Ravin in line with the median for the industry. Moreover, Seth Ravin also holds US$35m worth of Rimini Street stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 10% of total compensation represents salary, while the remainder of 90% is other remuneration. According to our research, Rimini Street 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 Rimini Street, Inc.'s Growth Numbers

Over the last three years, Rimini Street, Inc. has shrunk its earnings per share by 102% per year. Its revenue is down 1.5% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Rimini Street, Inc. Been A Good Investment?

Few Rimini Street, Inc. shareholders would feel satisfied with the return of -52% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

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 1 warning sign for Rimini Street that investors should think about before committing capital to this stock.

Switching gears from Rimini Street, 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.