Here's Why Ypsomed Holding AG's (VTX:YPSN) CEO May Deserve A Raise

Key Insights

• Ypsomed Holding to hold its Annual General Meeting on 26th of June
• Total pay for CEO Simon Michel includes CHF650.0k salary
• Total compensation is 56% below industry average
• Over the past three years, Ypsomed Holding's EPS grew by 132% and over the past three years, the total shareholder return was 179%

The solid performance at Ypsomed Holding AG (VTX:YPSN) has been impressive and shareholders will probably be pleased to know that CEO Simon Michel has delivered. This would be kept in mind at the upcoming AGM on 26th of June which will be a chance for them to hear the board review the financial results, discuss future company strategy and vote on resolutions such as executive remuneration and other matters. Let's take a look at why we think the CEO has done a good job and we'll present the case for a bump in pay.

View our latest analysis for Ypsomed Holding

How Does Total Compensation For Simon Michel Compare With Other Companies In The Industry?

Our data indicates that Ypsomed Holding AG has a market capitalization of CHF5.4b, and total annual CEO compensation was reported as CHF1.0m for the year to March 2024. We note that's a decrease of 8.2% compared to last year. We note that the salary portion, which stands at CHF650.0k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the Swiss Medical Equipment industry with market capitalizations ranging between CHF3.5b and CHF11b had a median total CEO compensation of CHF2.4m. That is to say, Simon Michel is paid under the industry median. Furthermore, Simon Michel directly owns CHF70m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	CHF650k	CHF650k	62%
Other	CHF395k	CHF488k	38%
Total Compensation	CHF1.0m	CHF1.1m	100%

Speaking on an industry level, nearly 25% of total compensation represents salary, while the remainder of 75% is other remuneration. Ypsomed Holding pays out 62% of remuneration in the form of a salary, significantly higher than the industry average. 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 Ypsomed Holding AG's Growth Numbers

Ypsomed Holding AG has seen its earnings per share (EPS) increase by 132% a year over the past three years. In the last year, its revenue is up 10%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Ypsomed Holding AG Been A Good Investment?

We think that the total shareholder return of 179%, over three years, would leave most Ypsomed Holding AG shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Ypsomed Holding that investors should think about before committing capital to this stock.

Switching gears from Ypsomed Holding, 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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com