Is Derichebourg (EPA:DBG) Overpaying Its CEO?
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
Daniel Derichebourg has been the CEO of Derichebourg (EPA:DBG) since 2006. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Derichebourg
How Does Daniel Derichebourg’s Compensation Compare With Similar Sized Companies?
Our data indicates that Derichebourg is worth €652m, and total annual CEO compensation is €243k. (This figure is for the year to 2016). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at €228k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of €348m to €1.4b. The median total CEO compensation was €588k.
A first glance this seems like a real positive for shareholders, since Daniel Derichebourg is paid less than the average compensation paid by similar sized companies. While this is a good thing, you’ll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Derichebourg has changed over time.
Is Derichebourg Growing?
Over the last three years Derichebourg has grown its earnings per share (EPS) by an average of 41% per year (using a line of best fit). In the last year, its revenue is up 6.9%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It’s also good to see modest revenue growth, suggesting the underlying business is healthy. It could be important to check this free visual depiction of what analysts expect for the future.
Has Derichebourg Been A Good Investment?
Most shareholders would probably be pleased with Derichebourg for providing a total return of 73% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
In Summary…
It appears that Derichebourg remunerates its CEO below most similar sized companies. Since the business is growing, many would argue this suggests the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Daniel Derichebourg deserves a raise!
Most shareholders like to see a modestly paid CEO combined with strong performance by the company. It would be even more positive if company insiders are buying shares. So you may want to check if insiders are buying Derichebourg shares with their own money (free access).
Important note: Derichebourg may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
