EcoSynthetix Inc.'s (TSE:ECO) CEO Will Probably Find It Hard To See A Huge Raise This Year

Key Insights

• EcoSynthetix will host its Annual General Meeting on 14th of May

• Total pay for CEO Jeff MacDonald includes US$335.5k salary

• Total compensation is similar to the industry average

• Over the past three years, EcoSynthetix's EPS grew by 4.2% and over the past three years, the total loss to shareholders 3.7%

In the past three years, shareholders of EcoSynthetix Inc. (TSE:ECO) have seen a loss on their investment. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 14th of May. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

View our latest analysis for EcoSynthetix

How Does Total Compensation For Jeff MacDonald Compare With Other Companies In The Industry?

At the time of writing, our data shows that EcoSynthetix Inc. has a market capitalization of CA$278m, and reported total annual CEO compensation of US$776k for the year to December 2023. This means that the compensation hasn't changed much from last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$336k.

On examining similar-sized companies in the Canadian Chemicals industry with market capitalizations between CA$137m and CA$549m, we discovered that the median CEO total compensation of that group was US$829k. So it looks like EcoSynthetix compensates Jeff MacDonald in line with the median for the industry. Furthermore, Jeff MacDonald directly owns CA$5.4m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 72% of total compensation represents salary and 28% is other remuneration. EcoSynthetix sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

EcoSynthetix Inc.'s Growth

EcoSynthetix Inc.'s earnings per share (EPS) grew 4.2% per year over the last three years. Its revenue is down 20% over the previous year.

We would argue that the lack of revenue growth in the last year is less than ideal, but the modest EPS growth gives us some relief. It's hard to reach a conclusion about business performance right now. This may be one to watch. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has EcoSynthetix Inc. Been A Good Investment?

Since shareholders would have lost about 3.7% over three years, some EcoSynthetix Inc. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. Shareholders would be keen to know what's holding the stock back when earnings have grown. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for EcoSynthetix that investors should look into moving forward.

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.