Here's Why We Think Coda Octopus Group, Inc.'s (NASDAQ:CODA) CEO Compensation Looks Fair for the time being

Key Insights

• Coda Octopus Group to hold its Annual General Meeting on 12th of September
• Salary of US$305.0k is part of CEO Annmarie Gayle's total remuneration
• The overall pay is comparable to the industry average
• Coda Octopus Group's total shareholder return over the past three years was 23% while its EPS grew by 15% over the past three years

CEO Annmarie Gayle has done a decent job of delivering relatively good performance at Coda Octopus Group, Inc. (NASDAQ:CODA) recently. As shareholders go into the upcoming AGM on 12th of September, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. We present our case of why we think CEO compensation looks fair.

Check out our latest analysis for Coda Octopus Group

Comparing Coda Octopus Group, Inc.'s CEO Compensation With The Industry

At the time of writing, our data shows that Coda Octopus Group, Inc. has a market capitalization of US$86m, and reported total annual CEO compensation of US$405k for the year to October 2022. There was no change in the compensation compared to last year. We note that the salary portion, which stands at US$305.0k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the American Electronic industry with market capitalizations below US$200m, reported a median total CEO compensation of US$436k. So it looks like Coda Octopus Group compensates Annmarie Gayle in line with the median for the industry. What's more, Annmarie Gayle holds US$481k worth of shares in the company in their own name.

Component	2022	2021	Proportion (2022)
Salary	US$305k	US$305k	75%
Other	US$100k	US$100k	25%
Total Compensation	US$405k	US$405k	100%

On an industry level, roughly 32% of total compensation represents salary and 68% is other remuneration. Coda Octopus Group pays out 75% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Coda Octopus Group, Inc.'s Growth

Coda Octopus Group, Inc. has seen its earnings per share (EPS) increase by 15% a year over the past three years. It achieved revenue growth of 2.6% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. 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 Coda Octopus Group, Inc. Been A Good Investment?

Coda Octopus Group, Inc. has served shareholders reasonably well, with a total return of 23% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 2 warning signs for Coda Octopus Group that investors should look into moving forward.

Important note: Coda Octopus Group 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.