Patrick Berard has been the CEO of Rexel S.A. (EPA:RXL) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Patrick Berard’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Rexel S.A. has a market cap of €3.2b, and is paying total annual CEO compensation of €2.5m. (This figure is for the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at €650k. We looked at a group of companies with market capitalizations from €1.8b to €5.7b, and the median CEO total compensation was €1.5m.
It would therefore appear that Rexel S.A. pays Patrick Berard 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 get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Rexel, below.
Is Rexel S.A. Growing?
On average over the last three years, Rexel S.A. has grown earnings per share (EPS) by 3.5% each year (using a line of best fit). Revenue was pretty flat on last year.
I’m not particularly impressed by the revenue growth, but it is good to see modest EPS growth. It’s clear the performance has been quite decent, but it it falls short of outstanding,based on this information.
Has Rexel S.A. Been A Good Investment?
With a three year total loss of 10%, Rexel S.A. would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We compared total CEO remuneration at Rexel S.A. with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. So you may want to check if insiders are buying Rexel shares with their own money (free access).
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Thank you for reading.