Shareholders Will Probably Hold Off On Increasing 3U Holding AG's (ETR:UUU) CEO Compensation For The Time Being

CEO Michael Schmidt has done a decent job of delivering relatively good performance at 3U Holding AG (ETR:UUU) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 20 May 2021. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for 3U Holding

Comparing 3U Holding AG's CEO Compensation With the industry

At the time of writing, our data shows that 3U Holding AG has a market capitalization of €114m, and reported total annual CEO compensation of €620k for the year to December 2020. Notably, that's an increase of 46% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at €300k.

In comparison with other companies in the industry with market capitalizations under €166m, the reported median total CEO compensation was €212k. This suggests that Michael Schmidt is paid more than the median for the industry. What's more, Michael Schmidt holds €29m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2020	2019	Proportion (2020)
Salary	€300k	€300k	48%
Other	€320k	€126k	52%
Total Compensation	€620k	€426k	100%

Talking in terms of the industry, salary represented approximately 29% of total compensation out of all the companies we analyzed, while other remuneration made up 71% of the pie. 3U Holding is paying a higher share of its remuneration through a 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.

A Look at 3U Holding AG's Growth Numbers

3U Holding AG's earnings per share (EPS) grew 43% per year over the last three years. It achieved revenue growth of 19% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, 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 3U Holding AG Been A Good Investment?

We think that the total shareholder return of 176%, over three years, would leave most 3U Holding AG shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 4 warning signs for 3U Holding (of which 1 is concerning!) that you should know about in order to have a holistic understanding of the stock.

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. 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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