What Can We Learn About Dassault Aviation's (EPA:AM) CEO Compensation?

Éric Trappier became the CEO of Dassault Aviation SA (EPA:AM) in 2013, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Dassault Aviation pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Dassault Aviation

Comparing Dassault Aviation SA's CEO Compensation With the industry

At the time of writing, our data shows that Dassault Aviation SA has a market capitalization of €7.3b, and reported total annual CEO compensation of €3.0m for the year to December 2019. We note that's an increase of 11% above last year. In particular, the salary of €1.57m, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the industry with market capitalizations between €3.3b and €9.8b, we discovered that the median CEO total compensation of that group was €6.0m. This suggests that Éric Trappier is paid below the industry median. Moreover, Éric Trappier also holds €2.3m worth of Dassault Aviation stock directly under their own name.

Talking in terms of the industry, salary represented approximately 41% of total compensation out of all the companies we analyzed, while other remuneration made up 59% of the pie. It's interesting to note that Dassault Aviation pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Dassault Aviation SA's Growth

Dassault Aviation SA saw earnings per share stay pretty flat over the last three years. Its revenue is up 7.0% over the last year.

The lack of EPS growth is certainly unimpressive. The fairly low revenue growth fails to impress given that the EPS is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Dassault Aviation SA Been A Good Investment?

With a three year total loss of 30% for the shareholders, Dassault Aviation SA would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

As we touched on above, Dassault Aviation SA is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. EPS growth has failed to impress us, and the same can be said about shareholder returns. We can't say the CEO compensation is high, but shareholders will be cold to a bump at this stage, considering negative investor returns.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 1 warning sign for Dassault Aviation that investors should look into moving forward.

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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