In the recent annual meeting of Vector Group (NYSE:VGR) Ltd., a company known for its tobacco products, stockholders cast their votes on several key proposals, according to a regulatory filing with the Securities and Exchange Commission. The meeting, which took place on Monday, saw a mixed response from the shareholders, particularly on executive compensation and corporate governance issues.
The first proposal, which concerned the election of directors, resulted in all nominated directors being reelected to the board. Votes against directors varied, with some directors facing higher opposition than others. Bennett S. LeBow, for example, received 118,795,591 votes for and 3,179,695 against, with 311,883 abstentions. Broker non-votes were reported at 18,300,140 and, per the company's bylaws, did not affect the outcome.
The second proposal, an advisory "say on pay" vote regarding executive compensation, did not pass as smoothly. With 77,042,769 votes for and 44,653,552 against, it indicated a significant portion of shareholders expressed discontent with the pay structure for named executive officers. Abstentions stood at 590,849, and once again, broker non-votes did not impact the decision.
Shareholders showed strong support for the third proposal, ratifying Deloitte & Touche LLP as the company's independent registered public accounting firm for the year ending December 31, 2024. The proposal passed with 139,604,305 votes for, 583,960 against, and 399,043 abstentions.
The fourth proposal, which suggested amending the company's governing documents to require an independent director as the Chairman of the Board, received less support. This advisory vote saw 43,806,884 votes for and 77,908,250 against, with 572,029 abstentions. Broker non-votes, which again did not affect the result, were reported at 18,300,146.
The outcomes of these votes reflect shareholder perspectives on the direction of the company and its governance. The results from the meeting are based on the information provided in the SEC filing by Vector Group Ltd .
In other recent news, Vector Group Ltd. reported a modest increase in revenues to $371.9 million in its second-quarter financial report of 2024. This marks a rise from the $365.7 million reported in the same quarter of the previous year. The company's net income also saw a substantial increase to $54.2 million, or $0.34 per diluted common share, up from $38.1 million, or $0.24 per diluted common share.
The tobacco segment, led by Liggett Vector Brands, was a notable performer with a 10.5% increase in adjusted operating income. The discount cigarette brand Montego also saw an uptick in market share.
These recent developments indicate Vector Group's positive performance in the discount tobacco segment, with anticipation of continued growth even if economic conditions worsen. However, wholesale shipments of Liggett declined, albeit less than the industry average.
Despite this, the deep discount market segment is outperforming the overall U.S. cigarette market, with strong performance noted in independent retailers and discount stores. The regulatory environment remains favorable for Vector Group. The company is also considering options for its capital structure and addressing upcoming bond dues.
InvestingPro Insights
As Vector Group Ltd. navigates the feedback from its shareholders on executive compensation and governance, it's worth noting the company's current financial standing and market performance. According to InvestingPro data, Vector Group boasts a market capitalization of $2.38 billion and trades at a P/E ratio of 11.9, which is considered low relative to its near-term earnings growth.
This low earnings multiple may be attractive to value-oriented investors, especially given the company's significant dividend yield of 5.72%, a testament to its commitment to shareholder returns, underscored by a 30-year streak of maintained dividend payments.
InvestingPro Tips highlight that the stock is currently trading near its 52-week high, with a price 97.42% of this peak, and has shown strong returns over various periods, including the last month (18.06%), the last three months (27.99%), and the last year (41.69%). These robust returns, combined with a solid financial base where liquid assets exceed short-term obligations, provide a compelling picture of the company's financial health.
Investors can find more insights and tips, such as the company's overbought status as suggested by the RSI, by visiting InvestingPro for Vector Group Ltd. at https://www.investing.com/pro/VGR, which offers an additional 12 InvestingPro Tips for a comprehensive investment analysis.
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