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Shareholders May Be A Bit More Conservative With MongoDB, Inc.'s (NASDAQ:MDB) CEO Compensation For Now

Key Insights

  • MongoDB will host its Annual General Meeting on 25th of June

  • Salary of US$400.0k is part of CEO Dev Ittycheria's total remuneration

  • Total compensation is similar to the industry average

  • MongoDB's three-year loss to shareholders was 43% while its EPS grew by 18% over the past three years

The underwhelming share price performance of MongoDB, Inc. (NASDAQ:MDB) in the past three years would have disappointed many shareholders. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 25th of June could be an opportunity for shareholders to bring these concerns to the board's attention. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

View our latest analysis for MongoDB

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

At the time of writing, our data shows that MongoDB, Inc. has a market capitalization of US$16b, and reported total annual CEO compensation of US$15m for the year to January 2024. Notably, that's an increase of 15% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$400k.

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In comparison with other companies in the American IT industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$18m. So it looks like MongoDB compensates Dev Ittycheria in line with the median for the industry. Furthermore, Dev Ittycheria directly owns US$36m worth of shares in the company, implying that they are deeply invested in the company's success.

Component

2024

2023

Proportion (2024)

Salary

US$400k

US$400k

3%

Other

US$15m

US$13m

97%

Total Compensation

US$15m

US$13m

100%

Speaking on an industry level, nearly 22% of total compensation represents salary, while the remainder of 78% is other remuneration. Investors may find it interesting that MongoDB paid a marginal salary to Dev Ittycheria, over the past year, focusing on non-salary compensation instead. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
ceo-compensation

A Look at MongoDB, Inc.'s Growth Numbers

Over the past three years, MongoDB, Inc. has seen its earnings per share (EPS) grow by 18% per year. Its revenue is up 29% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has MongoDB, Inc. Been A Good Investment?

Few MongoDB, Inc. shareholders would feel satisfied with the return of -43% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

MongoDB prefers rewarding its CEO through non-salary benefits. The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 3 warning signs for MongoDB that investors should be aware of in a dynamic business environment.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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.

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