Here's Why We Think Zug Estates Holding AG's (VTX:ZUGN) CEO Compensation Looks Fair

Key Insights

• Zug Estates Holding will host its Annual General Meeting on 15th of April
• CEO Patrik Stillhart's total compensation includes salary of CHF437.5k
• Total compensation is 43% below industry average
• Zug Estates Holding's EPS declined by 8.1% over the past three years while total shareholder return over the past three years was 7.7%

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Performance at Zug Estates Holding AG (VTX:ZUGN) has been rather uninspiring recently and shareholders may be wondering how CEO Patrik Stillhart plans to fix this. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 15th of April. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We think CEO compensation looks appropriate given the data we have put together.

See our latest analysis for Zug Estates Holding

Comparing Zug Estates Holding AG's CEO Compensation With The Industry

According to our data, Zug Estates Holding AG has a market capitalization of CHF1.0b, and paid its CEO total annual compensation worth CHF705k over the year to December 2024. We note that's an increase of 9.5% above last year. In particular, the salary of CHF437.5k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Swiss Real Estate industry with market capitalizations ranging between CHF858m and CHF2.7b had a median total CEO compensation of CHF1.2m. This suggests that Patrik Stillhart is paid below the industry median. Furthermore, Patrik Stillhart directly owns CHF178k worth of shares in the company.

On an industry level, around 48% of total compensation represents salary and 52% is other remuneration. Zug Estates Holding is paying a higher share of its remuneration through a 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.

Zug Estates Holding AG's Growth

Zug Estates Holding AG has reduced its earnings per share by 8.1% a year over the last three years. Its revenue is up 4.7% over the last year.

Few shareholders would be pleased to read that EPS have declined. The fairly low revenue growth fails to impress given that the EPS is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings. .

Has Zug Estates Holding AG Been A Good Investment?

With a total shareholder return of 7.7% over three years, Zug Estates Holding AG has done okay by shareholders, but there's always room for improvement. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

In Summary...

Shareholder returns while positive, need to be looked at along with earnings, which have failed to grow and this could mean that the current momentum may not continue. These are are some concerns that shareholders may want to address the board when they revisit their investment thesis.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 3 warning signs for Zug Estates Holding (2 are significant!) that you should be aware of before investing here.

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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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.