Erik Kinnmann became the CEO of NeuroVive Pharmaceutical AB (STO:NVP) in 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Erik Kinnmann's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that NeuroVive Pharmaceutical AB has a market cap of kr237m, and reported total annual CEO compensation of kr3.9m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at kr2.1m. We took a group of companies with market capitalizations below kr1.9b, and calculated the median CEO total compensation to be kr1.1m.
It would therefore appear that NeuroVive Pharmaceutical AB pays Erik Kinnmann more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at NeuroVive Pharmaceutical, below.
Is NeuroVive Pharmaceutical AB Growing?
On average over the last three years, NeuroVive Pharmaceutical AB has grown earnings per share (EPS) by 38% each year (using a line of best fit). It achieved revenue growth of 137% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. It could be important to check this free visual depiction of what analysts expect for the future.
Has NeuroVive Pharmaceutical AB Been A Good Investment?
Given the total loss of 54% over three years, many shareholders in NeuroVive Pharmaceutical AB are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We examined the amount NeuroVive Pharmaceutical AB pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
However, the earnings per share growth over three years is certainly impressive. However, the returns to investors are far less impressive, over the same period. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling NeuroVive Pharmaceutical (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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