Key Insights

• LightPath Technologies to hold its Annual General Meeting on 20th of November
• Total pay for CEO Sam Rubin includes US$378.1k salary
• Total compensation is similar to the industry average
• LightPath Technologies' three-year loss to shareholders was 15% while its EPS was down 5.6% over the past three years

Shareholders will probably not be too impressed with the underwhelming results at LightPath Technologies, Inc. (NASDAQ:LPTH) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 20th of November. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.

How Does Total Compensation For Sam Rubin Compare With Other Companies In The Industry?

According to our data, LightPath Technologies, Inc. has a market capitalization of US$62m, and paid its CEO total annual compensation worth US$478k over the year to June 2024. Notably, that's a decrease of 14% over the year before. In particular, the salary of US$378.1k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the American Electronic industry with market capitalizations under US$200m, the reported median total CEO compensation was US$384k. So it looks like LightPath Technologies compensates Sam Rubin in line with the median for the industry. Furthermore, Sam Rubin directly owns US$273k worth of shares in the company.

On an industry level, roughly 28% of total compensation represents salary and 72% is other remuneration. It's interesting to note that LightPath Technologies pays out a greater portion of remuneration through salary, compared to the industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at LightPath Technologies, Inc.'s Growth Numbers

Over the last three years, LightPath Technologies, Inc. has shrunk its earnings per share by 5.6% per year. In the last year, its revenue is down 4.7%.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last 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 LightPath Technologies, Inc. Been A Good Investment?

With a three year total loss of 15% for the shareholders, LightPath Technologies, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

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, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

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. We did our research and identified 4 warning signs (and 1 which is a bit concerning) in LightPath Technologies we think you should know about.

Important note: LightPath Technologies is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.