Today we will examine how invested Intel's CEO and the Board of Directors are in the company. This information can help us understand how aligned the decision makers at Intel are with shareholders, and how much they tangibly believe in the success of the company.
In 2021, the year Pat Gelsinger became CEO of Intel, he received a compensation package worth $178.6M. The majority of his compensation was tied to the performance of Intel's stock price.
If by February 15, 2026, Intel's stock reaches a certain price, and stays there for 90 days, Pat will receive the following:
At $74.47 he will get ~$63.3M
At $148.95 he will get another ~$45.7M
Since Intel's price has not reached these levels, Pat has not received most of the compensation from his 2021 package.
These price targets are important to me because if they are reached within the next 3 years, I will receive a great return on my investment. As of today, the average price I paid for my shares is $47.20.
If Pat achieves his goals, my investment will increase:
57% at $74.47
Triple at $148.95
As of March 11, 2023, Pat owns 432,597 shares of Intel. I believe he is aligned with the interests of shareholders.
INTEL'S BOARD OF DIRECTORS
The list below shows how many shares each Intel Board Member owns, along with the year they joined the Board:
2022: Barbara Novick: 0
2022: Lip-Bu Tan: 100,500
2021: Pat Gelsinger: 432,597
2021: Andrea Goldsmith: 0
2020: Alyssa Henry: 15,400
2020: Dion Weisler: 27,450
2019: James Goetz: 198,521
2018: Risa Lavizzo-Mourey: 12,079
2017: Omar Ishrak: 46,224
2017: Gregory Smith: 15,203
2016: Tsu-Jae King Liu: 18,924
2009: Frank Yeary: 58,808
I always found Omar Ishrak interesting because he joined the Board in 2017 and became the Chairman in 2020, but he only started buying shares of Intel in October 2021 (4 years after he joined the Board and 8 months after Pat joined the company).
I always wonder why it took Omar so long to buy shares of the company where he was the Chairman. Maybe he believed the company was going in the wrong direction under the previous CEO and he did not want to waste his money. Maybe Pat eventually encouraged him to buy shares to show solidarity with shareholders.
Ultimately, I am not sure why Omar took so long to buy shares in Intel, but to me, not buying shares for 4 years seems like a lack of commitment to the company and shareholders. I was not surprised when he got replaced as Chairman of the Board by Frank Yeary in January 2023.
Aside from Barbara Novick and Andrea Goldsmith, the Board Members seem invested in the company. I am going to monitor Barbara Novick and Andrea Goldsmith to see if they eventually buy shares in Intel.
When shares of a company are purchased/sold by a member of the Board or Management Team, it is considered an "Insider Transaction," and that person needs to fill out a form with the Securities and Exchange Commission (SEC) called a "Form 4". This form can be found on the Sec.gov website.
Image showing location of Form 4 on Sec.gov website.
Form 4 filled out by Patrick Gelsinger when he bought 9,700 shares of Intel on 2/23/2023 for $25.6785.
I use the website Openinsider.com to find the total amount of shares that each insider of a company owns. When you visit the site, enter the stock symbol of the company and the relevant information will appear.
Image of Openinsider.com
A detailed breakdown of the total compensation for members of a company's Management Team or Board of Directors is located in a company's DEF 14A/ Proxy Statement.
This document can be found on the Sec.gov website or on a company's Investor Relations page.
Image showing where DEF 14A/Proxy Statement can be found on the Sec.gov website.
God willing, we will review Intel's DEF 14A together in a future post.
Thanks for taking the time to read today's post.
See you next week, God willing.
“Whatever you do, work heartily, as for the Lord and not for men, knowing that from the Lord you will receive the inheritance as your reward. You are serving the Lord Christ.”
Colossians 3:23-24 ESV
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