Increases to CEO Compensation Might Be Put On Hold For Now at Stabilus SE (ETR:STM)

Key Insights

• Stabilus will host its Annual General Meeting on 7th of February
• CEO Michael Büchsner's total compensation includes salary of €540.0k
• The total compensation is 38% higher than the average for the industry
• Stabilus' total shareholder return over the past three years was 3.9% while its EPS grew by 49% over the past three years

Under the guidance of CEO Michael Büchsner, Stabilus SE (ETR:STM) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 7th of February. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Stabilus

Comparing Stabilus SE's CEO Compensation With The Industry

Our data indicates that Stabilus SE has a market capitalization of €1.6b, and total annual CEO compensation was reported as €1.8m for the year to September 2023. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €540k.

For comparison, other companies in the German Machinery industry with market capitalizations ranging between €926m and €3.0b had a median total CEO compensation of €1.3m. Accordingly, our analysis reveals that Stabilus SE pays Michael Büchsner north of the industry median.

Component	2023	2022	Proportion (2023)
Salary	€540k	€504k	30%
Other	€1.3m	€1.3m	70%
Total Compensation	€1.8m	€1.8m	100%

On an industry level, roughly 53% of total compensation represents salary and 47% is other remuneration. Stabilus sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Stabilus SE's Growth

Stabilus SE's earnings per share (EPS) grew 49% per year over the last three years. In the last year, its revenue is up 5.7%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Stabilus SE Been A Good Investment?

With a total shareholder return of 3.9% over three years, Stabilus SE 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...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Stabilus that investors should be aware of in a dynamic business environment.

Important note: Stabilus 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. 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.