In 2009 Philippe Crouzet was appointed CEO of Vallourec SA (EPA:VK). 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. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Philippe Crouzet’s Compensation Compare With Similar Sized Companies?
Our data indicates that Vallourec SA is worth €1.7b, and total annual CEO compensation is €2.1m. We note that’s an increase of 27% above last year. When we examined a selection of companies with market caps ranging from €886m to €2.8b, we found the median CEO compensation was €993k.
As you can see, Philippe Crouzet is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Vallourec SA is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Vallourec has changed from year to year.
Is Vallourec SA Growing?
Over the last three years Vallourec SA has grown its earnings per share (EPS) by an average of 80% per year. It achieved revenue growth of 19% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. IThis sort of respectable year-on-year revenue growth is often seen at a healthy, growing business.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Vallourec SA Been A Good Investment?
With a three year total loss of 31%, Vallourec SA would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We compared the total CEO remuneration paid by Vallourec SA, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. On the other hand returns to investors over the same period have probably disappointed many. This contrasts with the growth in CEO remuneration, in the last year. Considering the per share profit growth, but keeping in mind the weak returns, we’d need more time to form a view on CEO compensation. Shareholders may want to check for free if Vallourec SA insiders are buying or selling shares.
Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .
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 email@example.com.