Key Insights

• Standard Motor Products to hold its Annual General Meeting on 16th of May

• Salary of US$720.0k is part of CEO Eric Sills's total remuneration

• The total compensation is 43% less than the average for the industry

• Over the past three years, Standard Motor Products' EPS fell by 13% and over the past three years, the total loss to shareholders 24%

Performance at Standard Motor Products, Inc. (NYSE:SMP) has not been particularly rosy recently and shareholders will likely be holding CEO Eric Sills and the board accountable for this. The next AGM coming up on 16th of May will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. The data we gathered below shows that CEO compensation looks acceptable for now.

Check out our latest analysis for Standard Motor Products

How Does Total Compensation For Eric Sills Compare With Other Companies In The Industry?

At the time of writing, our data shows that Standard Motor Products, Inc. has a market capitalization of US$708m, and reported total annual CEO compensation of US$1.2m for the year to December 2023. That's a notable decrease of 20% on last year. In particular, the salary of US$720.0k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the American Auto Components industry with market capitalizations ranging between US$400m and US$1.6b had a median total CEO compensation of US$2.0m. Accordingly, Standard Motor Products pays its CEO under the industry median. Moreover, Eric Sills also holds US$20m worth of Standard Motor Products stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 13% of total compensation represents salary, while the remainder of 87% is other remuneration. It's interesting to note that Standard Motor Products pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Standard Motor Products, Inc.'s Growth Numbers

Over the last three years, Standard Motor Products, Inc. has shrunk its earnings per share by 13% per year. Its revenue is down 1.1% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Standard Motor Products, Inc. Been A Good Investment?

Given the total shareholder loss of 24% over three years, many shareholders in Standard Motor Products, Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

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 is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 1 warning sign for Standard Motor Products that investors should be aware of in a dynamic business environment.

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.