Is Elis SA’s (EPA:ELIS) CEO Overpaid Relative To Its Peers?

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Xavier Martiré is the CEO of Elis SA (EPA:ELIS). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Elis

How Does Xavier Martiré’s Compensation Compare With Similar Sized Companies?

Our data indicates that Elis SA is worth €3.5b, and total annual CEO compensation is €3.4m. (This number is for the twelve months until December 2017). We think total compensation is more important but we note that the CEO salary is lower, at €550k. We looked at a group of companies with market capitalizations from €1.8b to €5.6b, and the median CEO total compensation was €1.5m.

Thus we can conclude that Xavier Martiré receives more in total compensation than the median of a group of companies in the same market, and of similar size to Elis SA. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Elis has changed over time.

ENXTPA:ELIS CEO Compensation, June 27th 2019
ENXTPA:ELIS CEO Compensation, June 27th 2019

Is Elis SA Growing?

Elis SA has increased its earnings per share (EPS) by an average of 30% a year, over the last three years (using a line of best fit). It achieved revenue growth of 43% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business.

Has Elis SA Been A Good Investment?

Elis SA has served shareholders reasonably well, with a total return of 11% over three years. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary…

We compared the total CEO remuneration paid by Elis SA, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

However, the earnings per share growth over three years is certainly impressive. We also think investors are doing ok, over the same time period. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we’d recommend further research on management. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Elis (free visualization of insider trades).

Important note: Elis may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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.