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Is Eurocommercial Properties N.V. (AMS:ECMPA) Overpaying Its CEO?

Simply Wall St

Jeremy Lewis is the CEO of Eurocommercial Properties N.V. (AMS:ECMPA). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Eurocommercial Properties

How Does Jeremy Lewis's Compensation Compare With Similar Sized Companies?

Our data indicates that Eurocommercial Properties N.V. is worth €1.1b, and total annual CEO compensation was reported as €1.1m for the year to June 2019. While we always look at total compensation first, we note that the salary component is less, at €723k. We examined companies with market caps from €902m to €2.9b, and discovered that the median CEO total compensation of that group was €1.6m.

Most shareholders would consider it a positive that Jeremy Lewis takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it's important we delve into the performance of the actual business.

The graphic below shows how CEO compensation at Eurocommercial Properties has changed from year to year.

ENXTAM:ECMPA CEO Compensation, February 1st 2020

Is Eurocommercial Properties N.V. Growing?

On average over the last three years, Eurocommercial Properties N.V. has shrunk earnings per share by 53% each year (measured with a line of best fit). In the last year, its revenue is up 1.2%.

Unfortunately, earnings per share have trended lower over the last three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.

Has Eurocommercial Properties N.V. Been A Good Investment?

Since shareholders would have lost about 19% over three years, some Eurocommercial Properties N.V. shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

It appears that Eurocommercial Properties N.V. remunerates its CEO below most similar sized companies.

Jeremy Lewis is paid less than CEOs of similar size companies, but the company isn't growing and total shareholder returns have been disappointing. We would not call the pay too generous, but nor would we claim the CEO is underpaid, given lacklustre business performance. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Eurocommercial Properties.

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.

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