In 2016 Sidney Toledano was appointed CEO of Christian Dior SE (EPA:CDI). First, this article will compare CEO compensation with compensation at 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.
Check out our latest analysis for Christian Dior
How Does Sidney Toledano's Compensation Compare With Similar Sized Companies?
Our data indicates that Christian Dior SE is worth €82b, and total annual CEO compensation was reported as €12m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at €1.4m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We took a group of companies with market capitalizations over €7.1b, and calculated the median CEO total compensation to be €3.2m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
As you can see, Sidney Toledano is paid more than the median CEO pay at large companies, in the same market. However, this does not necessarily mean Christian Dior SE is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Christian Dior has changed from year to year.
Is Christian Dior SE Growing?
On average over the last three years, Christian Dior SE has grown earnings per share (EPS) by 13% each year (using a line of best fit). Its revenue is up 12% over last year.
This demonstrates that the company has been improving recently. A good result. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has Christian Dior SE Been A Good Investment?
Most shareholders would probably be pleased with Christian Dior SE for providing a total return of 158% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
In Summary...
We compared total CEO remuneration at Christian Dior SE with the amount paid at other large companies. Our data suggests that it pays above the median CEO pay within that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. Even better, returns to shareholders have been plentiful, over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. So you may want to check if insiders are buying Christian Dior shares with their own money (free access).
If you want to buy a stock that is better than Christian Dior, this free list of high return, low debt companies is a great place to look.
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.
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