Increases to CEO Compensation Might Be Put On Hold For Now at Stryker Corporation (NYSE:SYK)

Key Insights

• Stryker to hold its Annual General Meeting on 8th of May
• CEO Kevin Lobo's total compensation includes salary of US$1.44m
• Total compensation is 39% above industry average
• Stryker's total shareholder return over the past three years was 60% while its EPS grew by 14% over the past three years

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Performance at Stryker Corporation (NYSE:SYK) has been reasonably good and CEO Kevin Lobo has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 8th of May. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Stryker

Comparing Stryker Corporation's CEO Compensation With The Industry

At the time of writing, our data shows that Stryker Corporation has a market capitalization of US$143b, and reported total annual CEO compensation of US$22m for the year to December 2024. That's a fairly small increase of 5.8% over the previous year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.4m.

On comparing similar companies in the American Medical Equipment industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$16m. This suggests that Kevin Lobo is paid more than the median for the industry. Moreover, Kevin Lobo also holds US$46m worth of Stryker stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	US$1.4m	US$1.4m	7%
Other	US$21m	US$19m	93%
Total Compensation	US$22m	US$21m	100%

On an industry level, roughly 25% of total compensation represents salary and 75% is other remuneration. Stryker sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Stryker Corporation's Growth Numbers

Stryker Corporation has seen its earnings per share (EPS) increase by 14% a year over the past three years. It achieved revenue growth of 10% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. 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 Stryker Corporation Been A Good Investment?

Boasting a total shareholder return of 60% over three years, Stryker Corporation has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

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. That's why we did some digging and identified 2 warning signs for Stryker that you should be aware of before investing.

Important note: Stryker 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.