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Is Alstom SA's (EPA:ALO) CEO Paid Enough Relative To Peers?

Simply Wall St

In 2016 Henri Poupart-Lafarge was appointed CEO of Alstom SA (EPA:ALO). First, this article will compare CEO compensation with compensation at other large companies. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Alstom

How Does Henri Poupart-Lafarge's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Alstom SA has a market cap of €8.9b, and reported total annual CEO compensation of €3.1m for the year to March 2019. We think total compensation is more important but we note that the CEO salary is lower, at €750k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We took a group of companies with market capitalizations over €7.3b, and calculated the median CEO total compensation to be €3.4m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).

That means Henri Poupart-Lafarge receives fairly typical remuneration for the CEO of a large company. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

The graphic below shows how CEO compensation at Alstom has changed from year to year.

ENXTPA:ALO CEO Compensation, December 2nd 2019

Is Alstom SA Growing?

On average over the last three years, Alstom SA has grown earnings per share (EPS) by 65% each year (using a line of best fit). In the last year, its revenue is up 2.3%.

This demonstrates that the company has been improving recently. A good result. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Shareholders might be interested in this free visualization of analyst forecasts.

Has Alstom SA Been A Good Investment?

Most shareholders would probably be pleased with Alstom SA for providing a total return of 82% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Henri Poupart-Lafarge is paid around what is normal the leaders of larger companies.

Shareholders would surely be happy to see that shareholder returns have been great, and the earnings per share are up. Indeed, many might consider the pay rather modest, given the solid company performance! So you may want to check if insiders are buying Alstom shares with their own money (free access).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.