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Key Insights

• Premier to hold its Annual General Meeting on 1st of December

• Total pay for CEO Mike Alkire includes US$1.07m salary

• Total compensation is similar to the industry average

• Over the past three years, Premier's EPS fell by 16% and over the past three years, the total loss to shareholders 37%

Shareholders will probably not be too impressed with the underwhelming results at Premier, Inc. (NASDAQ:PINC) recently. At the upcoming AGM on 1st of December, shareholders can hear from the board including their plans for turning around performance. 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

See our latest analysis for Premier

How Does Total Compensation For Mike Alkire Compare With Other Companies In The Industry?

Our data indicates that Premier, Inc. has a market capitalization of US$2.5b, and total annual CEO compensation was reported as US$7.8m for the year to June 2023. That's mostly flat as compared to the prior year's compensation. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.1m.

On examining similar-sized companies in the American Healthcare industry with market capitalizations between US$2.0b and US$6.4b, we discovered that the median CEO total compensation of that group was US$6.3m. This suggests that Premier remunerates its CEO largely in line with the industry average. Moreover, Mike Alkire also holds US$4.9m worth of Premier stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 19% of total compensation represents salary, while the remainder of 81% is other remuneration. Premier sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Premier, Inc.'s Growth

Premier, Inc. has reduced its earnings per share by 16% a year over the last three years. Its revenue is down 2.9% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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.