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Is Hypoport AG’s (FRA:HYQ) CEO Being Overpaid?

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Ronald Slabke became the CEO of Hypoport AG (FRA:HYQ) in 2011. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. 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.

View our latest analysis for Hypoport

How Does Ronald Slabke’s Compensation Compare With Similar Sized Companies?

Our data indicates that Hypoport AG is worth €963m, and total annual CEO compensation is €544k. (This is based on the year to 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at €425k. We looked at a group of companies with market capitalizations from €354m to €1.4b, and the median CEO compensation was €1.2m.

Most shareholders would consider it a positive that Ronald Slabke takes less 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.

You can see, below, how CEO compensation at Hypoport has changed over time.

DB:HYQ CEO Compensation December 17th 18
DB:HYQ CEO Compensation December 17th 18

Is Hypoport AG Growing?

Over the last three years Hypoport AG has grown its earnings per share (EPS) by an average of 10% per year. Its revenue is up 30% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see.

It could be important to check this free visual depiction of what analysts expect for the future.

Has Hypoport AG Been A Good Investment?

I think that the total shareholder return of 112%, over three years, would leave most Hypoport AG shareholders smiling. So they may not be at all concerned if the CEO is paid more than is normal for companies around the same size.

In Summary…

It appears that Hypoport AG remunerates its CEO below most similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. The strong history of shareholder returns might even have some thinking that Ronald Slabke deserves a raise!

It is relatively rare to see a modestly paid CEO when performance is so impressive. But it is even better if company insiders are also buying shares with their own money. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Hypoport.

Or you might prefer examine intently this intuitive graph showing past 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.