Latest news with #executivecompensation
Forbes
06-08-2025
- Business
- Forbes
A Quality Exec Comp Plan Lowers The Risk Of Investing In JBSS
Incentives play a critical role in shaping behavior. When a company ties executive compensation to revenue growth or flawed metrics like adjusted EBITDA, it's only natural that executives will prioritize those targets. However, growing revenue or adjusted EBITDA without regard for real profits undermines the company's long-term financial health. It also destroys shareholder value. I think that the board of directors for more publicly-traded companies should tie executive compensation to metrics that drive shareholder value creation. There is no better metric for this purpose than return on invested capital (ROIC). Linking executive compensation to ROIC aligns the interests of the executives with those of the shareholders. The Exec Comp Aligned with ROIC Model Portfolio includes only those stocks that (1) receive an Attractive-or-better rating and (2) directly link executive compensation to ROIC. I believe this combination signals disciplined capital allocation and strong upside potential. I am proud to offer the Exec Comp Aligned with ROIC Model Portfolio, and I am excited to give you a stock pick from this Model Portfolio. The goal behind sharing these stock picks with you is to deliver insight into the uniquely high value-add of my research. Stock Pick for July: John B. Sanfilippo & Son, Inc. John B. Sanfilippo has grown revenue and net operating profit after tax (NOPAT) by 3% and 9% compounded annually since fiscal 2014, respectively. The company's NOPAT margin improved from 3% in fiscal 2014 to 6% in the TTM and invested capital turns increased from 2.4 to 2.5 over the same time. Rising NOPAT margins and invested capital turns drive the company's return on invested capital (ROIC) from 8% in fiscal 2014 to 14% in the TTM. Figure 1: John B. Sanfilippo's Revenue & NOPAT: Fiscal 2014 – TTM Executive Compensation Properly Aligns Incentives John B. Sanfilippo's executive compensation plan aligns the interests of executives and shareholders by tying its annual bonus awards to a 'Return on Capital/economic value added' model which, according to the company's proxy statement, the company calls the Sanfilippo-Value Added plan. Under the plan, executives are rewarded for year-over-year improvement in economic profit. The company's inclusion of economic profit targets, which are similar to my economic earnings, has helped create shareholder value by driving higher ROIC and economic earnings. When I calculate ROIC using my firm's superior fundamental data, I find that John B. Sanfilippo's ROIC has increased from 8% in fiscal 2014 to 14% in the TTM. Economic earnings rose from $15 million to $37 million over the same time. See Figure 2. Figure 2: John B. Sanfilippo's Economic Earnings: Fiscal 2014 – TTM JBSS Has Further Upside At its current price of $64/share, JBSS has a price-to-economic book value (PEBV) ratio of 0.8. This ratio means the market expects John B. Sanfilippo's NOPAT to permanently fall 20% from current levels. This expectation seems overly pessimistic for a company that has grown NOPAT 7% and 9% compounded annually over the last five and ten years, respectively. Even if John B. Sanfilippo's: the stock would be worth $87/share today – a 36% upside. In this scenario, John B. Sanfilippo's NOPAT would grow just 2% compounded annually from 2025 through 2034. Should the company grow NOPAT more in line with historical growth rates, the stock has even more upside. Critical Details Found in Financial Filings by My Firm's Robo-Analyst Technology Below are specifics on the adjustments I made based on Robo-Analyst findings in John B. Sanfilippo's 10-K and 10-Qs: Income Statement: I made under $15 million in adjustments with a net effect of removing under $5 million in non-operating expense. Balance Sheet: I made under $100 million in adjustments to calculate invested capital with a net decrease of under $10 million. One of the most notable adjustments was for asset write downs. Valuation: I made over $150 million in adjustments, all of which decreased shareholder value. The most notable adjustment to shareholder value was total debt.
Yahoo
02-08-2025
- Business
- Yahoo
NRC's Q2 Earnings Rise Y/Y on Cost Control and TRCV Growth
Shares of National Research Corporation NRC have declined 10% since the company reported its earnings for the quarter ended June 30, 2025. This compares to the S&P 500 index's 0.7% decline over the same time frame. Over the past month, the stock has declined 24.4% compared with the S&P 500's 2.1% growth. National Research reported second-quarter 2025 adjusted net income per share of 28 cents, up from 26 cents in the year-ago quarter. The company posted revenues of $34 million, down 2.8% from $35 million in the year-ago quarter. The company posted a net loss of $0.1 million compared to the net income of $6.2 million in the second quarter of 2024. This downturn was driven primarily by one-time executive compensation expenses. However, on an adjusted basis, excluding these non-recurring items and non-cash stock compensation, adjusted net income rose slightly to $6.4 million from $6.1 million a year ago. Adjusted EBITDA for the quarter was $10.3 million, essentially flat year over year, with a margin of 30.3%, reflecting stable profitability when excluding unusual items. National Research Corporation Price, Consensus and EPS Surprise National Research Corporation price-consensus-eps-surprise-chart | National Research Corporation Quote Recurring Revenue Momentum Continues Total recurring contract value (TRCV), a key measure of projected revenues under renewable contracts for the next 12 months, grew 2% sequentially, marking the third straight quarter of growth and the strongest sequential gain since early 2021. Management attributed this to a strengthened salesforce, improved customer retention, and a product suite resonating with the market. These improvements were evident in the increasing rate of new logo acquisitions and successful cross-selling initiatives. Executive Commentary and Leadership Transition New CEO Trent S. Green expressed optimism about the company's trajectory, citing growing enthusiasm from customers and prospects. He emphasized the organization's dedication to delivering a high-touch service model alongside a compelling product portfolio. Green also reinstated the company's quarterly earnings calls to enhance transparency and shareholder communication. Impact of Executive Compensation on Net Results The headline net loss for the quarter was largely the result of $6.6 million in non-recurring executive compensation expenses related to leadership transitions following the departure of the founder. This, along with elevated stock-based compensation, led to a 0% GAAP net margin. However, excluding these costs, NRC's operational performance remained steady, supported by continued cost discipline and higher revenue per full-time employee. SG&A expenses surged to $17.7 million from $11.2 million last year, reflecting the bulk of the compensation impact, while direct costs declined 3.3% year over year. Shareholder Returns and Capital Allocation NRC continued returning capital to shareholders, repurchasing 381,736 shares at an average price of $14.96 during the quarter. Year to date, the company has returned $16.1 million through dividends and buybacks. Its board of directors also declared a quarterly dividend of 12 cents per share, payable on Oct. 10, 2025, to shareholders of record as of Sept. 26, 2025. Balance Sheet Position As of June 30, 2025, NRC reported $5.3 million in cash, up from $4.2 million at the end of 2024. However, total debt increased to $81 million from $62.7 million, with higher notes payable reflecting greater leverage. Shareholders' equity fell to $21.3 million from $31.3 million at year-end, largely due to treasury stock purchases and net losses on a GAAP basis. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report National Research Corporation (NRC) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
31-07-2025
- Business
- Yahoo
Figma's CEO Stands to Make Billions Post-IPO. Here's What's In His Pay Package
Key Takeaways Figma CEO Dylan Field stands to be very wealthy if he can hit the marks outlined in his pay package. The design software maker's trading debut puts big awards within reach. Field could make $1.9 billion if Figma's stock price reaches the highest hurdle, or $130, within 10 years of its (FIG) is shooting the lights out on its trading debut. The latest big IPO stands to make co-founder and chief Dylan Field very rich. The design software maker's shares recently traded around $108, a few bucks below intraday highs. (Its IPO priced at $33 per share, above an upwardly revised range of $30 to $32.) That first-day action puts Field's performance-based executive compensation awards well within reach. Some 14.5 million shares in restricted stock units have been set aside as a stock price award, split across seven tranches, according to filings. If the shares' 60-day average price hits $60, the low end of targets, Field would unlock $130 million worth. If the stock meets the highest hurdle, or $130, that package would grow to $1.9 billion. Field has 10 years to hit those marks. That doesn't include the 22.5 million shares split between service- and market-based awards Figma granted Field in 2021, which can be unlocked sooner. There are 7.9 million shares of Class B common stock that Field can vest as part of his service-based package, which are worth roughly $670 million based on the the stock's $85 Thursday open. There is also a CEO market reward that grants Field an additional 11.25 million shares separated into three tranches tied to laddered market-valuation targets of $15 billion, $20 billion, and $25 billion. And there's cash: Figma's board in 2024 raised Field's base salary to $500,000 from $450,000. Field can thank Elon Musk and his richly-valued pay package at Tesla (TSLA) for raising the compensation ceiling for other CEOs. Though Musk's $56 billion compensation was rejected twice by courts, the chief of the EV maker launched an appeal in March to restore it. Read the original article on Investopedia Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
24-07-2025
- Business
- Reuters
Macquarie shareholders challenge executive pay as regulatory, earnings stress mount
SYDNEY, July 24 (Reuters) - Macquarie Group ( opens new tab, employer of Australia's best-paid CEO, said on Thursday it will review its executive compensation following a regulatory compliance lawsuit as shareholders appeared to vote against its salary plans for the first time at its annual meeting. The investment bank also announced that its chief financial officer was retiring, a surprise development which takes out one possible successor to current leader Shemara Wikramanayake who started in 2018, and reported a dip in first-quarter profit, pushing its shares lower. The rethink of its top-level pay reflects an unusual degree of investor pushback against a company nicknamed the millionaire factory due to its compensation as heightened regulatory scrutiny and weaker earnings at some of its global businesses stoke disquiet among shareholders. Cooling M&A activity and relatively subdued oil and gas markets have squeezed profit at two of its four main operating units. Adding to the pressure on the investment bank, the Australian corporate regulator sued Macquarie in May accusing it of misreporting up to 1.5 billion short sales. Macquarie has said it picked up and reported the mistakes and is reviewing ASIC's claim. "It was always likely that there were going to be some observers who were going to say 'you should have gone more one way or the other'," Macquarie Chair Glenn Stevens told media before the annual meeting in Sydney. "I find it a little bit disappointing how many feel that, but it is what it is and we have to hear that message," Stevens, who was Reserve Bank of Australia governor from 2006 to 2016, said. At the meeting, Stevens told shareholders the "remuneration impacts ... will be an FY26 matter, about which the board will come to a view over the period ahead". CEO Shemara Wikramanayake earned A$30 million in 2024, making her the highest paid chief executive among ASX 100 companies and the only woman in Australia's top 20 highest paid executives, according, opens new tab to the Australian Council of Superannuation Investors. Proxy advisors to Macquarie shareholders recommended voting about 25% against the company's remuneration report, according to slides presented at the meeting, although Stevens said the company would publish a final result later. If more than 25% of shareholders vote against an Australian company's remuneration report for two years running, shareholders can hold another vote on whether to dismiss the entire board. Macquarie shares were nearly 5% lower by midsession, compared with a flat overall market (.AXJO), opens new tab, as investors fretted about the multiple headwinds facing the company. Macquarie said profit in the three months to June was lower than a year earlier due to lower contributions from its asset management arm and commodities and global markets unit. The company did not disclose specific profit figures in the limited trading update. "We see (Macquarie) as a great business caught in the midst of both its own transition and global realignment of geopolitical alliances and capital flows," said Jarden analysts in a client note. CFO Alex Harvey, asked by media to elaborate on his departure, said only that he had achieved what he set out to do and it was time to promote his deputy Frank Kwok. CEO Wikramanayake, asked about her future in the role, said: "I'm committed to Macquarie for as long as Macquarie needs me."
Reuters
24-07-2025
- Business
- Reuters
Macquarie faces shareholder backlash over executive pay as CFO steps down
July 24 (Reuters) - Macquarie Group ( opens new tab, the employer of Australia's best-paid CEO, said on Thursday it will review its executive compensation following a regulatory compliance lawsuit, as some shareholders prepare to vote against its salary plans at its annual meeting. Chief Financial Officer Alex Harvey will also retire, the company said, an unexpected development which deprives it of one possible successor to current leader Shemara Wikramanayake who started in 2018. Shares tumbled as much as 5% in early trade to A$214, their biggest intraday percentage drop in three months, and underperformed a 0.2% gain on the broader benchmark (.AXJO), opens new tab. Chairman Glenn Stevens said on a media call the non-binding remuneration vote at Thursday's AGM "does appear to be quite close." When asked about potential shareholder opposition, Stevens said: "It was always likely that there were going to be some observers who were going to say 'you should have gone more one way or the other'. I find it a little bit disappointing how many feel that, but it is what it is and we have to hear that message." The vote can be defeated with 25% opposition, and if an Australian company receives two "strikes" in consecutive years, shareholders can hold another vote on whether to dismiss the entire board. The leadership changes and pay review come as Australia's corporate regulator ASIC has sued Macquarie, alleging it misreported up to A$1.5 billion worth of short sales over 15 years, misleading the market and violating post-financial crisis transparency rules. Stevens said Macquarie is focusing on "remediation of regulatory issues, and associated strengthening of the company's risk culture," adding that "where shortcomings are identified, the board holds staff accountable, seeks to incentivize future improvement and reflects on what the issue might tell us about the organization's culture." CEO Shemara Wikramanayake earned A$30 million in 2024, making her the highest paid chief executive among ASX 100 companies and the only woman in Australia's top 20 highest paid executives, according, opens new tab to the Australian Council of Superannuation Investors. Separately, Macquarie reported a decline in first-quarter net profit due to lower contributions from its asset management arm and commodities and global markets unit. The company did not disclose specific profit figures in its quarterly trading update. The asset management division experienced softer performance primarily due to timing of investment-related income, while commodities recorded lower net interest and trading income in North American Gas and Power, it added.
