Key Insights

• Charles River Laboratories International to hold its Annual General Meeting on 8th of May
• Total pay for CEO Jim Foster includes US$1.46m salary
• The overall pay is 52% above the industry average
• Charles River Laboratories International's three-year loss to shareholders was 33% while its EPS grew by 7.9% over the past three years

In the past three years, the share price of Charles River Laboratories International, Inc. (NYSE:CRL) has struggled to grow and now shareholders are sitting on a loss. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. The AGM coming up on the 8th of May could be an opportunity for shareholders to bring these concerns to the board's attention. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

How Does Total Compensation For Jim Foster Compare With Other Companies In The Industry?

According to our data, Charles River Laboratories International, Inc. has a market capitalization of US$12b, and paid its CEO total annual compensation worth US$14m over the year to December 2023. That's a fairly small increase of 4.8% over the previous year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.5m.

For comparison, other companies in the American Life Sciences industry with market capitalizations above US$8.0b, reported a median total CEO compensation of US$9.3m. Hence, we can conclude that Jim Foster is remunerated higher than the industry median. What's more, Jim Foster holds US$61m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Speaking on an industry level, nearly 17% of total compensation represents salary, while the remainder of 83% is other remuneration. Charles River Laboratories International 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.

Charles River Laboratories International, Inc.'s Growth

Charles River Laboratories International, Inc. has seen its earnings per share (EPS) increase by 7.9% a year over the past three years. Its revenue is up 3.9% over the last year.

We'd prefer higher revenue growth, but it is good to see modest EPS growth. Considering these factors we'd say performance has been pretty decent, though not amazing. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Charles River Laboratories International, Inc. Been A Good Investment?

The return of -33% over three years would not have pleased Charles River Laboratories International, Inc. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

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 probably be keen to find out what are the other factors could be weighing down the stock. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

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 2 warning signs for Charles River Laboratories International that investors should look into moving forward.

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.

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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.