Stock Analysis

Here's What We Think About DMG MORI AKTIENGESELLSCHAFT's (ETR:GIL) CEO Pay

  •  Updated
XTRA:GIL
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Christian Thones became the CEO of DMG MORI AKTIENGESELLSCHAFT (ETR:GIL) in 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. 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.

See our latest analysis for DMG MORI

How Does Christian Thones's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that DMG MORI AKTIENGESELLSCHAFT has a market cap of €3.3b, and reported total annual CEO compensation of €2.9m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at €900k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. When we examined a selection of companies with market caps ranging from €1.8b to €5.8b, we found the median CEO total compensation was €2.5m.

So Christian Thones receives a similar amount to the median CEO pay, amongst the companies we looked at. 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. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

The graphic below shows how CEO compensation at DMG MORI has changed from year to year.

XTRA:GIL CEO Compensation, October 29th 2019
XTRA:GIL CEO Compensation, October 29th 2019

Is DMG MORI AKTIENGESELLSCHAFT Growing?

On average over the last three years, DMG MORI AKTIENGESELLSCHAFT has grown earnings per share (EPS) by 16% each year (using a line of best fit). It achieved revenue growth of 11% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business.

Has DMG MORI AKTIENGESELLSCHAFT Been A Good Investment?

With a total shareholder return of 9.2% over three years, DMG MORI AKTIENGESELLSCHAFT has done okay by shareholders. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Remuneration for Christian Thones is close enough to the median pay for a CEO of a similar sized company .

We would wish for better returns (whether dividends or capital gains) but we do admire the solid EPS growth on show here. As a result of these considerations, I would suggest the CEO pay is reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling DMG MORI shares (free trial).

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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.

About XTRA:GIL

DMG MORI

DMG MORI AKTIENGESELLSCHAFT produces and sells cutting machine tools worldwide.

The Snowflake is a visual investment summary with the score of each axis being calculated by 6 checks in 5 areas.

Analysis AreaScore (0-6)
Valuation3
Future Growth0
Past Performance4
Financial Health6
Dividends0

Read more about these checks in the individual report sections or in our analysis model.

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