Shareholders May Be More Conservative With Sanmina Corporation's (NASDAQ:SANM) CEO Compensation For Now

Key Insights

• Sanmina to hold its Annual General Meeting on 13th of March
• Total pay for CEO Jure Sola includes US$1.22m salary
• The total compensation is 128% higher than the average for the industry
• Sanmina's total shareholder return over the past three years was 145% while its EPS grew by 34% over the past three years

Under the guidance of CEO Jure Sola, Sanmina Corporation (NASDAQ:SANM) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 13th of March. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Sanmina

Comparing Sanmina Corporation's CEO Compensation With The Industry

According to our data, Sanmina Corporation has a market capitalization of US$3.5b, and paid its CEO total annual compensation worth US$17m over the year to October 2022. That's a notable increase of 15% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.2m.

For comparison, other companies in the American Electronic industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$7.4m. Hence, we can conclude that Jure Sola is remunerated higher than the industry median. Moreover, Jure Sola also holds US$57m worth of Sanmina stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2022	2021	Proportion (2022)
Salary	US$1.2m	US$1.1m	7%
Other	US$16m	US$13m	93%
Total Compensation	US$17m	US$15m	100%

On an industry level, roughly 36% of total compensation represents salary and 64% is other remuneration. Sanmina sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Sanmina Corporation's Growth Numbers

Sanmina Corporation has seen its earnings per share (EPS) increase by 34% a year over the past three years. In the last year, its revenue is up 26%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Sanmina Corporation Been A Good Investment?

We think that the total shareholder return of 145%, over three years, would leave most Sanmina Corporation shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

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 1 warning sign for Sanmina that you should be aware of before investing.

Switching gears from Sanmina, 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.