Pardee Resources Company - 2019 Annual Report

We've mentioned Pardee Resources before on the blog in The Problem With "Sum of the Parts", "What is an Oddball Stock?", and a brief mention last year of their share repurchase. Pardee was the main idea that Nate wrote up in Issue 1 of the Oddball Stocks Newsletter. We write about them fairly frequently in the Newsletter and they were in our recent Highlight Issue.

Pardee is normally a great annual meeting to go to - the only one that serves lunch - but it won't be happening in person this year. The virtual meeting is scheduled for Friday, May 22nd.

According to the proxy statement, there were 654,191 shares outstanding on April 1st, which was up from the year-end count of 649,448.

The increase is from stock compensation. Pardee has high SG&A cost some of which seems to stem from compensation. The non-employee directors of the Company get a board retainer of $50,000, and equity award of $50,000, and $3,000 for each board meeting. There are seven non-employee directors. The non-executive chairman receives a retainer of $125,000 and an equity award of $50,000. That's a total of $875,000 not counting the meeting fees and other additional retainers paid to committee chairs.

At a share price of $123, the Pardee market capitalization is now $80.5 million. So the board compensation alone is a 1% annual drag.

Stay tuned for the June 2020 Issue (#30) of the Newsletter coming up next month where we will share more thoughts about Pardee.

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