U.S. Markets closed

Is EON SE’s (FRA:EOAN) CEO Paid At A Competitive Rate?

Johannes Teyssen became the CEO of EON SE (FRA:EOAN) in 2010. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for E.ON

How Does Johannes Teyssen’s Compensation Compare With Similar Sized Companies?

Our data indicates that EON SE is worth €19b, and total annual CEO compensation is €5.3m. That’s a modest increase of 2.8% on the prior year year. We looked at a group of companies with market capitalizations over €7.1b and the median CEO compensation was €3.9m.

Thus we can conclude that Johannes Teyssen receives more in total compensation than the median of a group of large companies in the same market as EON SE. However, this doesn’t necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

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

DB:EOAN CEO Compensation November 14th 18

Is EON SE Growing?

On average over the last three years, EON SE has grown earnings per share (EPS) by 75% each year. Its revenue is down -4.6% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. While it would be good to see revenue growth, profits matter more in the end.

You might want to check this free visual report on analyst forecasts for future earnings.

Has EON SE Been A Good Investment?

EON SE has served shareholders reasonably well, with a total return of 11% over three years. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary…

We compared the total CEO remuneration paid by EON SE, and compared it to remuneration at a group of other large companies. As discussed above, we discovered that the company pays more than the median of that group.

However we must not forget that the EPS growth has been very strong over three years. We also note that, over the same time frame, shareholder returns haven’t been bad. While it may be worth researching further, we don’t see a problem with the CEO pay, given the good EPS growth. Whatever your view on compensation, you might want to check if insiders are buying or selling EON SE shares (free trial).

Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.

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.