Key Insights
- Dorman Products' Annual General Meeting to take place on 16th of May
- Total pay for CEO Kevin Olsen includes US$941.3k salary
- The total compensation is 41% less than the average for the industry
- Dorman Products' EPS grew by 18% over the past three years while total shareholder return over the past three years was 26%
Shareholders will be pleased by the robust performance of Dorman Products, Inc. (NASDAQ:DORM) recently and this will be kept in mind in the upcoming AGM on 16th of May. The focus will probably be on the future strategic initiatives that the board and management will put in place to improve the business rather than executive remuneration when they cast their votes on company resolutions. Here is our take on why we think CEO compensation is fair and may even warrant a raise.
See our latest analysis for Dorman Products
How Does Total Compensation For Kevin Olsen Compare With Other Companies In The Industry?
At the time of writing, our data shows that Dorman Products, Inc. has a market capitalization of US$3.8b, and reported total annual CEO compensation of US$6.5m for the year to December 2024. Notably, that's an increase of 54% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$941k.
In comparison with other companies in the American Auto Components industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$11m. That is to say, Kevin Olsen is paid under the industry median. Moreover, Kevin Olsen also holds US$5.5m worth of Dorman Products 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$941k | US$885k | 14% |
| Other | US$5.6m | US$3.3m | 86% |
| Total Compensation | US$6.5m | US$4.2m | 100% |
Speaking on an industry level, nearly 14% of total compensation represents salary, while the remainder of 86% is other remuneration. Although there is a difference in how total compensation is set, Dorman Products more or less reflects the market in terms of setting the salary. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Dorman Products, Inc.'s Growth
Over the past three years, Dorman Products, Inc. has seen its earnings per share (EPS) grow by 18% per year. Its revenue is up 6.0% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 Dorman Products, Inc. Been A Good Investment?
Dorman Products, Inc. has generated a total shareholder return of 26% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
In Summary...
The company's overall performance, while not bad, could be better. If it continues on the same road, shareholders might feel even more confident about their investment, and have little to no objections concerning CEO pay. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Dorman Products that you should be aware of before investing.
Switching gears from Dorman Products, 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.
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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.