How Much Does Fagron's (EBR:FAGR) CEO Make?

Rafael Padilla became the CEO of Fagron NV (EBR:FAGR) in 2017, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Fagron.

Check out our latest analysis for Fagron

How Does Total Compensation For Rafael Padilla Compare With Other Companies In The Industry?

At the time of writing, our data shows that Fagron NV has a market capitalization of €1.4b, and reported total annual CEO compensation of €768k for the year to December 2019. That's just a smallish increase of 3.5% on last year. Notably, the salary which is €475.0k, represents most of the total compensation being paid.

For comparison, other companies in the same industry with market capitalizations ranging between €821m and €2.6b had a median total CEO compensation of €668k. This suggests that Fagron remunerates its CEO largely in line with the industry average.

On an industry level, around 71% of total compensation represents salary and 29% is other remuneration. Fagron sets aside a smaller share of compensation for salary, in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Fagron NV's Growth Numbers

Over the past three years, Fagron NV has seen its earnings per share (EPS) grow by 37% per year. It achieved revenue growth of 12% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Fagron NV Been A Good Investment?

Boasting a total shareholder return of 69% over three years, Fagron NV has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

As previously discussed, Rafael is compensated close to the median for companies of its size, and which belong to the same industry. Few would be critical of the leadership, since returns have been juicy and EPS are moving in the right direction. Although the pay is close to the industry median, overall performance is excellent, so we don't think the CEO is paid too generously. Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 1 warning sign for Fagron that investors should be aware of in a dynamic business environment.

Switching gears from Fagron, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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