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Shareholders will probably not be disappointed by the robust results at Affimed N.V. (NASDAQ:AFMD) recently and they will be keeping this in mind as they go into the AGM on 15 June 2021. The focus will probably be on the future strategic initiatives that the board and management will put in place to improve the business rather than executive remuneration when they cast their votes on company resolutions. We have prepared some analysis below and we show why we think CEO compensation looks decent with even the possibility for a raise.
Comparing Affimed N.V.'s CEO Compensation With the industry
According to our data, Affimed N.V. has a market capitalization of US$1.0b, and paid its CEO total annual compensation worth €1.4m over the year to December 2020. That's mostly flat as compared to the prior year's compensation. While we always look at total compensation first, our analysis shows that the salary component is less, at €493k.
On examining similar-sized companies in the industry with market capitalizations between US$400m and US$1.6b, we discovered that the median CEO total compensation of that group was €2.7m. This suggests that Adi Hoess is paid below the industry median.
On an industry level, roughly 20% of total compensation represents salary and 80% is other remuneration. It's interesting to note that Affimed pays out a greater portion of remuneration through salary, compared to the industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Affimed N.V.'s Growth Numbers
Affimed N.V. has seen its earnings per share (EPS) increase by 6.3% a year over the past three years. In the last year, its revenue is up 35%.
It's great to see that revenue growth is strong. Combined with modest EPS growth, we get a good impression of the company. We'd stop short of saying the business performance is amazing, but there are enough positives to justify further research, or even adding the stock to your watch-list. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Affimed N.V. Been A Good Investment?
We think that the total shareholder return of 284%, over three years, would leave most Affimed N.V. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Overall, the company hasn't done too poorly performance-wise, but we would like to see some improvement. If it continues on the same road, shareholders might feel even more confident about their investment, and have little to no objections concerning CEO pay. Rather, investors would more likely want to engage on discussions related to key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 3 warning signs for Affimed (1 is significant!) that you should be aware of before investing here.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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