Is adesso AG (FRA:ADN1) Excessively Paying Its CEO?

In 2011 Michael Kenfenheuer was appointed CEO of adesso AG (FRA:ADN1). 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 process should give us an idea about how appropriately the CEO is paid.

See our latest analysis for adesso

How Does Michael Kenfenheuer’s Compensation Compare With Similar Sized Companies?

According to our data, adesso AG has a market capitalization of €372m, and pays its CEO total annual compensation worth €1m. We note that’s an increase of 157% above last year. When we examined a selection of companies with market caps ranging from €174m to €696m, we found the median CEO compensation was €699k.

As you can see, Michael Kenfenheuer is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean adesso AG is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see a visual representation of the CEO compensation at adesso, below.

DB:ADN1 CEO Compensation October 21st 18
DB:ADN1 CEO Compensation October 21st 18

Is adesso AG Growing?

adesso AG has increased its earnings per share (EPS) by an average of 33% a year, over the last three years It achieved revenue growth of 20% over the last year.

This demonstrates that the company has been improving recently. A good result. IThis sort of respectable year-on-year revenue growth is often seen at a healthy, growing business.

It could be important to check this free visual depiction of what analysts expect for the future.

Has adesso AG Been A Good Investment?

Most shareholders would probably be pleased with adesso AG for providing a total return of 233% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary…

We the total CEO remuneration paid by adesso AG, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

However, the earnings per share growth over three years is certainly impressive. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at adesso AG.

Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.