NOVATO, CA - Hennessy Advisors, Inc. has announced changes to the compensation arrangements for key executives, according to a recent SEC filing. Effective October 1, 2024, Neil J. Hennessy, the company's namesake and a significant figure in its leadership, will see a reduction in his quarterly incentive-based bonus from 6.5% to 5.0% of the firm's pre-tax profits. Simultaneously, Teresa M. Nilsen, another executive, will receive an increase in her quarterly bonus to 5.0% and a raise in annual base salary to $375,000.
These adjustments are part of amendments to their respective employment agreements. The changes in Mr. Hennessy's compensatory terms also include a modification of the calculation used to determine the reduction of the reserve account in case of an adjusted pre-tax loss in any subsequent quarter within the same fiscal year.
Additionally, the company's Chief Financial Officer and Senior Vice President, Kathryn R. Fahy, will receive an adjustment to her annual base salary, which is set to increase to $275,000 starting October 1, 2024. This decision was approved by the Compensation Committee of the Board of Directors on September 16, 2024.
Hennessy Advisors, Inc., based in Novato, California, is known for its investment advisory services and is listed on The Nasdaq Stock Market LLC under the trading symbols HNNA for its common stock and HNNAZ for its 4.87% Notes due 2026.
InvestingPro Insights
As Hennessy Advisors, Inc. restructures its executive compensation, the company's financial health and stock performance offer valuable context for investors. Hennessy Advisors is currently trading with a P/E ratio of 13.08, suggesting that the stock may be undervalued given its near-term earnings growth. This aligns with an InvestingPro Tip highlighting the company's low P/E ratio relative to its earnings growth. Additionally, with a consistent history of dividend payments for the last 20 years, the firm demonstrates a commitment to returning value to shareholders, a noteworthy point for income-focused investors.
Reviewing recent performance, Hennessy Advisors has enjoyed a strong return over the last year, with a price total return of 64.95%. The company's liquidity position is also robust, with liquid assets surpassing short-term obligations, which is reassuring for stakeholders monitoring financial stability. With an attractive dividend yield of 5.3%, the company stands out in the current investment landscape for those seeking yield.
For those interested in deeper analysis, InvestingPro offers additional tips on Hennessy Advisors, providing a comprehensive look at the company's financial metrics and stock performance. Visit the InvestingPro platform for more insights and to discover how many more tips are available for HNNA.
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