Stock Analysis

How Does Kreditbanken's (CPH:KRE) CEO Salary Compare to Peers?

CPSE:KRE
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Lars Jensen is the CEO of Kreditbanken A/S (CPH:KRE), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for Kreditbanken

How Does Total Compensation For Lars Jensen Compare With Other Companies In The Industry?

At the time of writing, our data shows that Kreditbanken A/S has a market capitalization of kr.569m, and reported total annual CEO compensation of kr.2.7m for the year to December 2019. That is, the compensation was roughly the same as last year. It is worth noting that the CEO compensation consists entirely of the salary, worth kr.2.7m.

In comparison with other companies in the industry with market capitalizations under kr.1.2b, the reported median total CEO compensation was kr.2.9m. This suggests that Kreditbanken remunerates its CEO largely in line with the industry average.

Component20192018Proportion (2019)
Salary kr.2.7m kr.2.6m 100%
Other - - -
Total Compensationkr.2.7m kr.2.6m100%

Talking in terms of the industry, salary represented approximately 85% of total compensation out of all the companies we analyzed, while other remuneration made up 15% of the pie. Speaking on a company level, Kreditbanken prefers to tread along a traditional path, disbursing all compensation through a salary. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

ceo-compensation
CPSE:KRE CEO Compensation December 25th 2020

Kreditbanken A/S' Growth

Earnings per share at Kreditbanken A/S are much the same as they were three years ago, albeit with slightly higher. It saw its revenue drop 16% over the last year.

We would argue that the lack of revenue growth in the last year is less than ideal, but the modest EPSgrowth gives us some relief. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Kreditbanken A/S Been A Good Investment?

Most shareholders would probably be pleased with Kreditbanken A/S for providing a total return of 35% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Kreditbanken rewards its CEO solely through a salary, ignoring non-salary benefits completely. As we noted earlier, Kreditbanken pays its CEO in line with similar-sized companies belonging to the same industry. However, the company's EPS growth numbers over the last three years is not that impressive. At the same time, shareholder returns have remained strong over the same period. We would like to see EPS growth from the business, although we wouldn't say the CEO compensation is high.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Kreditbanken that investors should think about before committing capital to this stock.

Switching gears from Kreditbanken, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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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