Here's What We Think About Ringmetall's (ETR:HP3) CEO Pay

The CEO of Ringmetall AG (ETR:HP3) is Christoph Petri, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Ringmetall pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Ringmetall

Comparing Ringmetall AG's CEO Compensation With the industry

At the time of writing, our data shows that Ringmetall AG has a market capitalization of €73m, and reported total annual CEO compensation of €284k for the year to December 2019. That's a fairly small increase of 5.2% over the previous year. Notably, the salary which is €185.0k, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under €165m, the reported median total CEO compensation was €597k. Accordingly, Ringmetall pays its CEO under the industry median.

Talking in terms of the industry, salary represented approximately 45% of total compensation out of all the companies we analyzed, while other remuneration made up 55% of the pie. It's interesting to note that Ringmetall pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Ringmetall AG's Growth Numbers

Over the last three years, Ringmetall AG has shrunk its earnings per share by 36% per year. Its revenue is up 6.4% 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. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Ringmetall AG Been A Good Investment?

With a three year total loss of 31% for the shareholders, Ringmetall AG would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As we touched on above, Ringmetall AG is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. While we are quite underwhelmed with EPS growth, the shareholder returns over the past three years have also failed to impress us. It's tough to say that Christoph is earning a very high compensation, but shareholders will likely want to see healthier investor returns before agreeing that a raise is in order.

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. We did our research and spotted 4 warning signs for Ringmetall that investors should look into moving forward.

Important note: Ringmetall is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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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