It May Be Possible That ProPhase Labs, Inc.'s (NASDAQ:PRPH) CEO Compensation Could Get Bumped Up

The decent performance at ProPhase Labs, Inc. (NASDAQ:PRPH) recently will please most shareholders as they go into the AGM coming up on 20 May 2021. This would also be a chance for them to hear the board review the financial results, discuss future company strategy to further improve the business and vote on any resolutions such as executive remuneration. In our analysis below, we discuss why we think the CEO compensation looks acceptable and the case for a raise.

View our latest analysis for ProPhase Labs

How Does Total Compensation For Ted Karkus Compare With Other Companies In The Industry?

According to our data, ProPhase Labs, Inc. has a market capitalization of US$84m, and paid its CEO total annual compensation worth US$445k over the year to December 2020. We note that's an increase of 79% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$125k.

For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$732k. Accordingly, ProPhase Labs pays its CEO under the industry median. Furthermore, Ted Karkus directly owns US$13m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 28% of total compensation represents salary and 72% is other remuneration. ProPhase Labs is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ProPhase Labs, Inc.'s Growth

Over the last three years, ProPhase Labs, Inc. has shrunk its earnings per share by 19% per year. In the last year, its revenue is up 47%.

The decrease in EPS could be a concern for some investors. On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has ProPhase Labs, Inc. Been A Good Investment?

Boasting a total shareholder return of 87% over three years, ProPhase Labs, Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Overall, the company hasn't done too poorly performance-wise, but we would like to see some improvement. Assuming the business continues to grow at a good clip, few shareholders would raise any objections to the CEO's remuneration. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 4 warning signs for ProPhase Labs that investors should think about before committing capital to this stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

This article by Simply Wall St is general in nature. 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.

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