Here's Why It's Unlikely That Calix, Inc.'s (NYSE:CALX) CEO Will See A Pay Rise This Year
Key Insights
Calix's Annual General Meeting to take place on 9th of May
Salary of US$560.0k is part of CEO Michael Weening's total remuneration
Total compensation is similar to the industry average
Calix's EPS declined by 33% over the past three years while total shareholder loss over the past three years was 38%
Shareholders will probably not be too impressed with the underwhelming results at Calix, Inc. (NYSE:CALX) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 9th of May. 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.
Check out our latest analysis for Calix
How Does Total Compensation For Michael Weening Compare With Other Companies In The Industry?
According to our data, Calix, Inc. has a market capitalization of US$1.9b, and paid its CEO total annual compensation worth US$7.2m over the year to December 2023. We note that's a decrease of 68% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$560k.
In comparison with other companies in the American Communications industry with market capitalizations ranging from US$1.0b to US$3.2b, the reported median CEO total compensation was US$7.1m. So it looks like Calix compensates Michael Weening in line with the median for the industry. Furthermore, Michael Weening directly owns US$457k worth of shares in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$560k | US$515k | 8% |
Other | US$6.6m | US$22m | 92% |
Total Compensation | US$7.2m | US$22m | 100% |
On an industry level, around 15% of total compensation represents salary and 85% is other remuneration. In Calix's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
Calix, Inc.'s Growth
Over the last three years, Calix, Inc. has shrunk its earnings per share by 33% per year. In the last year, its revenue is up 9.1%.
Few shareholders would be pleased to read that EPS have declined. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Calix, Inc. Been A Good Investment?
Few Calix, Inc. shareholders would feel satisfied with the return of -38% over three years. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.
CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 1 warning sign for Calix that investors should look into moving forward.
Important note: Calix 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
