We Discuss Why Coda Octopus Group, Inc.'s (NASDAQ:CODA) CEO Compensation May Be Closely Reviewed

Key Insights

• Coda Octopus Group's Annual General Meeting to take place on 4th of September
• Salary of US$305.0k is part of CEO Annmarie Gayle's total remuneration
• The total compensation is similar to the average for the industry
• Coda Octopus Group's EPS declined by 22% over the past three years while total shareholder loss over the past three years was 19%

The results at Coda Octopus Group, Inc. (NASDAQ:CODA) have been quite disappointing recently and CEO Annmarie Gayle bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 4th of September. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for Coda Octopus Group

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

Our data indicates that Coda Octopus Group, Inc. has a market capitalization of US$84m, and total annual CEO compensation was reported as US$405k for the year to October 2023. 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.

In comparison with other companies in the American Electronic industry with market capitalizations under US$200m, the reported median total CEO compensation was US$450k. This suggests that Coda Octopus Group remunerates its CEO largely in line with the industry average. Moreover, Annmarie Gayle also holds US$931k worth of Coda Octopus Group 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$305k	US$305k	75%
Other	US$100k	US$100k	25%
Total Compensation	US$405k	US$405k	100%

Talking in terms of the industry, salary represented approximately 31% of total compensation out of all the companies we analyzed, while other remuneration made up 69% of the pie. 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

Over the last three years, Coda Octopus Group, Inc. has shrunk its earnings per share by 22% per year. It saw its revenue drop 18% over the last year.

Overall this is not a very positive result for shareholders. 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. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Coda Octopus Group, Inc. Been A Good Investment?

Since shareholders would have lost about 19% over three years, some Coda Octopus Group, Inc. investors would surely be feeling negative emotions. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

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, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Coda Octopus Group that investors should think about before committing capital to this stock.

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.