Key Insights

• Rocky Brands will host its Annual General Meeting on 5th of June
• Salary of US$540.0k is part of CEO Jason Brooks's total remuneration
• Total compensation is 46% below industry average
• Rocky Brands' three-year loss to shareholders was 31% while its EPS was down 19% over the past three years

Performance at Rocky Brands, Inc. (NASDAQ:RCKY) has not been particularly rosy recently and shareholders will likely be holding CEO Jason Brooks and the board accountable for this. There is an opportunity for shareholders to influence management to turn the performance around by voting on resolutions such as executive remuneration at the AGM coming up on 5th of June. From our analysis below, we think CEO compensation looks appropriate for now.

Comparing Rocky Brands, Inc.'s CEO Compensation With The Industry

Our data indicates that Rocky Brands, Inc. has a market capitalization of US$265m, and total annual CEO compensation was reported as US$670k for the year to December 2023. That's a fairly small increase of 4.6% over the previous year. Notably, the salary which is US$540.0k, represents most of the total compensation being paid.

On examining similar-sized companies in the American Luxury industry with market capitalizations between US$100m and US$400m, we discovered that the median CEO total compensation of that group was US$1.2m. This suggests that Jason Brooks is paid below the industry median. Furthermore, Jason Brooks directly owns US$433k worth of shares in the company.

Speaking on an industry level, nearly 25% of total compensation represents salary, while the remainder of 75% is other remuneration. According to our research, Rocky Brands has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Rocky Brands, Inc.'s Growth Numbers

Over the last three years, Rocky Brands, Inc. has shrunk its earnings per share by 19% per year. In the last year, its revenue is down 17%.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Rocky Brands, Inc. Been A Good Investment?

The return of -31% over three years would not have pleased Rocky Brands, Inc. shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a 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.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 4 warning signs for Rocky Brands (of which 2 make us uncomfortable!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Rocky Brands, 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.