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Is Brunello Cucinelli S.p.A.'s (BIT:BC) CEO Pay Justified?

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Simply Wall St
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The CEO of Brunello Cucinelli S.p.A. (BIT:BC) is Brunello Cucinelli. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Brunello Cucinelli

How Does Brunello Cucinelli's Compensation Compare With Similar Sized Companies?

According to our data, Brunello Cucinelli S.p.A. has a market capitalization of €2.6b, and paid its CEO total annual compensation worth €803k over the year to December 2018. Notably, the salary of €803k is the vast majority of the CEO compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of €1.8b to €5.8b. The median total CEO compensation was €2.0m.

This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.

You can see a visual representation of the CEO compensation at Brunello Cucinelli, below.

BIT:BC CEO Compensation, January 20th 2020
BIT:BC CEO Compensation, January 20th 2020

Is Brunello Cucinelli S.p.A. Growing?

Over the last three years Brunello Cucinelli S.p.A. has grown its earnings per share (EPS) by an average of 17% per year (using a line of best fit). Its revenue is up 7.7% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. It could be important to check this free visual depiction of what analysts expect for the future.

Has Brunello Cucinelli S.p.A. Been A Good Investment?

Most shareholders would probably be pleased with Brunello Cucinelli S.p.A. for providing a total return of 79% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Brunello Cucinelli S.p.A. is currently paying its CEO below what is normal for companies of its size.

Since the business is growing, many would argue this suggests the pay is modest. The pleasing shareholder returns are the cherry on top; you might even consider that Brunello Cucinelli deserves a raise! Most shareholders like to see a modestly paid CEO combined with strong performance by the company. But it is even better if company insiders are also buying shares with their own money. Whatever your view on compensation, you might want to check if insiders are buying or selling Brunello Cucinelli shares (free trial).

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.