In 2004 Alessandro Cattani was appointed CEO of Esprinet S.p.A. (BIT:PRT). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Alessandro Cattani's Compensation Compare With Similar Sized Companies?
According to our data, Esprinet S.p.A. has a market capitalization of €267m, and paid its CEO total annual compensation worth €546k over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at €452k. When we examined a selection of companies with market caps ranging from €90m to €360m, we found the median CEO total compensation was €554k.
That means Alessandro Cattani receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
The graphic below shows how CEO compensation at Esprinet has changed from year to year.
Is Esprinet S.p.A. Growing?
On average over the last three years, Esprinet S.p.A. has shrunk earnings per share by 18% each year (measured with a line of best fit). It achieved revenue growth of 14% over the last year.
Unfortunately, earnings per share have trended lower over the last three years. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.
Has Esprinet S.p.A. Been A Good Investment?
With a three year total loss of 20%, Esprinet S.p.A. would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
Alessandro Cattani is paid around what is normal the leaders of comparable size companies.
After looking at EPS and total shareholder returns, it's certainly hard to argue the company has performed well, since both metrics are down. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. So you may want to check if insiders are buying Esprinet shares with their own money (free access).
If you want to buy a stock that is better than Esprinet, this free list of high return, low debt companies is a great place to look.
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