In 2014 Jacques van den Broek was appointed CEO of Randstad N.V. (AMS:RAND). First, this article will compare CEO compensation with compensation at other large companies. Then we'll look at a snap shot of the business growth. 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 Jacques van den Broek's Compensation Compare With Similar Sized Companies?
According to our data, Randstad N.V. has a market capitalization of €9.8b, and paid its CEO total annual compensation worth €2.8m over the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at €1.0m. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We took a group of companies with market capitalizations over €7.2b, and calculated the median CEO total compensation to be €3.9m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
That means Jacques van den Broek receives fairly typical remuneration for the CEO of a large company. 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 Randstad has changed from year to year.
Is Randstad N.V. Growing?
Over the last three years Randstad N.V. has grown its earnings per share (EPS) by an average of 5.6% per year (using a line of best fit). In the last year, its revenue changed by just 0.4%.
I'd prefer higher revenue growth, but the modest improvement in EPS is good. So there are some positives here, but not enough to earn high praise. You might want to check this free visual report on analyst forecasts for future earnings.
Has Randstad N.V. Been A Good Investment?
Randstad N.V. has served shareholders reasonably well, with a total return of 23% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
Remuneration for Jacques van den Broek is close enough to the median pay for a CEO of a large company .
We think many would like to see better growth. While the CEO may not be underpaid, we don't think the pay is too generous either. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Randstad.
Important note: Randstad may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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