Shareholders May Not Be So Generous With Procore Technologies, Inc.'s (NYSE:PCOR) CEO Compensation And Here's Why

Key Insights

• Procore Technologies will host its Annual General Meeting on 6th of June
• CEO Tooey Courtemanche's total compensation includes salary of US$545.0k
• Total compensation is similar to the industry average
• Procore Technologies' three-year loss to shareholders was 17% while its EPS grew by 43% over the past three years

The underwhelming share price performance of Procore Technologies, Inc. (NYSE:PCOR) in the past three years would have disappointed many shareholders. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 6th of June. 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 Procore Technologies

Comparing Procore Technologies, Inc.'s CEO Compensation With The Industry

At the time of writing, our data shows that Procore Technologies, Inc. has a market capitalization of US$9.8b, and reported total annual CEO compensation of US$13m for the year to December 2023. That's slightly lower by 6.8% over the previous year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$545k.

For comparison, other companies in the American Software industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$18m. So it looks like Procore Technologies compensates Tooey Courtemanche in line with the median for the industry. Moreover, Tooey Courtemanche also holds US$241m worth of Procore Technologies 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$545k	US$518k	4%
Other	US$12m	US$13m	96%
Total Compensation	US$13m	US$14m	100%

Speaking on an industry level, nearly 16% of total compensation represents salary, while the remainder of 84% is other remuneration. Procore Technologies has chosen to walk a path less trodden, opting to compensate its CEO with less of a traditional salary and more non-salary rewards over the last year. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Procore Technologies, Inc.'s Growth

Procore Technologies, Inc.'s earnings per share (EPS) grew 43% per year over the last three years. In the last year, its revenue is up 30%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Procore Technologies, Inc. Been A Good Investment?

With a three year total loss of 17% for the shareholders, Procore Technologies, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Procore Technologies prefers rewarding its CEO through non-salary benefits. 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. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for Procore Technologies that you should be aware of before investing.

Important note: Procore Technologies is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.