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Is Bobst Group SA's (VTX:BOBNN) CEO Pay Fair?

Simply Wall St

Jean-Pascal Bobst has been the CEO of Bobst Group SA (VTX:BOBNN) since 2009. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Bobst Group

How Does Jean-Pascal Bobst's Compensation Compare With Similar Sized Companies?

According to our data, Bobst Group SA has a market capitalization of CHF794m, and pays its CEO total annual compensation worth CHF1.6m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at CHF682k. When we examined a selection of companies with market caps ranging from CHF396m to CHF1.6b, we found the median CEO total compensation was CHF1.0m.

It would therefore appear that Bobst Group SA pays Jean-Pascal Bobst more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

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

SWX:BOBNN CEO Compensation, August 31st 2019

Is Bobst Group SA Growing?

On average over the last three years, Bobst Group SA has shrunk earnings per share by 5.8% each year (measured with a line of best fit). In the last year, its revenue is down -2.3%.

Few shareholders would be pleased to read that earnings per share are lower over three years. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.

Has Bobst Group SA Been A Good Investment?

Since shareholders would have lost about 5.0% over three years, some Bobst Group SA shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared total CEO remuneration at Bobst Group SA with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.

Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.

Over the same period, investors would have come away with nothing in the way of share price gains. In our opinion the CEO might be paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling Bobst Group shares (free trial).

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

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.

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. Thank you for reading.