Investors of LightPath Technologies are gearing up for the Annual General Meeting (AGM) scheduled for November 16, where CEO Sam Rubin's pay and the company's recent performance will be under the spotlight. Rubin's compensation for the fiscal year ending in June 2023 was $554,000, marking a 23% increase from the previous year. While his salary saw a modest rise from $357,000 to $361,000, his other compensation nearly doubled from $95,000 to $193,000.
Despite LightPath's market capitalization being a modest $56 million, Rubin's pay is reportedly consistent with the median for CEOs within the American Electronic industry for companies valued under $200 million. However, the structure of his pay package has raised eyebrows among stakeholders. A considerable 65% of Rubin's total compensation is made up of his salary, which is notably higher than the industry average of 32% that is typically linked to performance.
This emphasis on fixed salary over performance incentives comes into question particularly because LightPath has faced significant challenges recently. Over the past three years, the company's earnings per share (EPS) have plummeted by 66%, and shareholders have seen a total loss of 49%. Additionally, there was a revenue decline of 7.4% over the last year.
The upcoming AGM offers shareholders an opportunity to address these issues and potentially influence future compensation decisions. It is also worth noting that Rubin holds $151,000 worth of shares in LightPath Technologies. Given the company's underwhelming performance and negative shareholder returns, Rubin's increased pay may be difficult for some investors to justify.
Shareholders are encouraged to review additional aspects of LightPath's business operations and consider analyst forecasts for future earnings as they prepare for discussions at the AGM. In light of these financial results and executive compensation concerns, investors may also look at high return, low debt companies as potential alternatives for their portfolios.
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