Key Insights

• Entegris to hold its Annual General Meeting on 24th of April
• Total pay for CEO Bertrand Loy includes US$1.00m salary
• The total compensation is similar to the average for the industry
• Over the past three years, Entegris' EPS fell by 18% and over the past three years, the total shareholder return was 20%

Despite Entegris, Inc.'s (NASDAQ:ENTG) share price growing positively in the past few years, the per-share earnings growth has not grown to investors' expectations, suggesting that there could be other factors at play driving the share price. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 24th of April. They will be able to influence managerial decisions through the exercise of their voting power on resolutions, such as CEO remuneration and other matters, which may influence future company prospects. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

Comparing Entegris, Inc.'s CEO Compensation With The Industry

Our data indicates that Entegris, Inc. has a market capitalization of US$20b, and total annual CEO compensation was reported as US$13m for the year to December 2023. Notably, that's an increase of 11% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.0m.

On comparing similar companies in the American Semiconductor industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$19m. So it looks like Entegris compensates Bertrand Loy in line with the median for the industry. Moreover, Bertrand Loy also holds US$22m worth of Entegris stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 11% of total compensation out of all the companies we analyzed, while other remuneration made up 89% of the pie. It's interesting to note that Entegris allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Entegris, Inc.'s Growth Numbers

Over the last three years, Entegris, Inc. has shrunk its earnings per share by 18% per year. Its revenue is up 7.4% over the last year.

The decline in EPS is a bit concerning. The fairly low revenue growth fails to impress given that the EPS is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Entegris, Inc. Been A Good Investment?

With a total shareholder return of 20% over three years, Entegris, Inc. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary...

Despite the positive returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about whether these returns will continue. The upcoming AGM will provide shareholders the opportunity to revisit the company's remuneration policies and evaluate if the board's judgement and decision-making is aligned with that of the company's shareholders.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 2 warning signs for Entegris (of which 1 is a bit concerning!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Entegris, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.