Johannes Teyssen has been the CEO of E.ON SE (ETR:EOAN) since 2010. 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.
How Does Johannes Teyssen's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that E.ON SE has a market cap of €27b, and reported total annual CEO compensation of €5.3m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at €1.2m. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We looked at a group of companies with market capitalizations over €7.3b and the median CEO total compensation was €4.1m. There aren't very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
So Johannes Teyssen is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
You can see a visual representation of the CEO compensation at E.ON, below.
Is E.ON SE Growing?
On average over the last three years, E.ON SE has shrunk earnings per share by 54% each year (measured with a line of best fit). In the last year, its revenue changed by just 1.0%.
Sadly for shareholders, earnings per share are actually down, over three years. And the flat revenue hardly impresses. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. It could be important to check this free visual depiction of what analysts expect for the future.
Has E.ON SE Been A Good Investment?
I think that the total shareholder return of 63%, over three years, would leave most E.ON SE shareholders smiling. 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.
Johannes Teyssen is paid around the same as most CEOs of large companies.
We're not seeing great strides in earnings per share, but the company has clearly pleased some investors, given the returns over the last three years. So we think most shareholders wouldn't be too worried about CEO compensation, which is close to the median for large companies. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling E.ON (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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