The CEO of Bilfinger SE (ETR:GBF) is Tom Blades. 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Tom Blades's Compensation Compare With Similar Sized Companies?
Our data indicates that Bilfinger SE is worth €1.1b, and total annual CEO compensation was reported as €4.1m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at €1.2m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations from €364m to €1.5b, and the median CEO total compensation was €1.2m.
As you can see, Tom Blades is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Bilfinger SE is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Bilfinger has changed from year to year.
Is Bilfinger SE Growing?
Bilfinger SE has increased its earnings per share (EPS) by an average of 98% a year, over the last three years (using a line of best fit). It achieved revenue growth of 4.2% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Shareholders might be interested in this free visualization of analyst forecasts.
Has Bilfinger SE Been A Good Investment?
Since shareholders would have lost about 20% over three years, some Bilfinger SE shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
We examined the amount Bilfinger SE pays its CEO, and compared it to the amount paid by 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. 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. Whatever your view on compensation, you might want to check if insiders are buying or selling Bilfinger shares (free trial).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned.
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