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In 2012 Reinhard Ploss was appointed CEO of Infineon Technologies AG (ETR:IFX). This analysis aims first to contrast CEO compensation with other large companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Infineon Technologies
How Does Reinhard Ploss's Compensation Compare With Similar Sized Companies?
According to our data, Infineon Technologies AG has a market capitalization of €19b, and pays its CEO total annual compensation worth €3.0m. (This figure is for the year to September 2018). While we always look at total compensation first, we note that the salary component is less, at €1.2m. We looked at a group of companies with market capitalizations over €7.2b and the median CEO total compensation was €4.3m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
So Reinhard Ploss is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
You can see a visual representation of the CEO compensation at Infineon Technologies, below.
Is Infineon Technologies AG Growing?
Over the last three years Infineon Technologies AG has grown its earnings per share (EPS) by an average of 17% per year (using a line of best fit). It achieved revenue growth of 9.4% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. It could be important to check this free visual depiction of what analysts expect for the future.
Has Infineon Technologies AG Been A Good Investment?
With a total shareholder return of 27% over three years, Infineon Technologies AG shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Reinhard Ploss is paid around the same as most CEOs of large companies.
The company is growing EPS but shareholder returns have been sound but not amazing. 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 Infineon Technologies shares (free trial).
If you want to buy a stock that is better than Infineon Technologies, this free list of high return, low debt companies is a great place to look.
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.