We Think Shareholders Are Less Likely To Approve A Pay Rise For Pierre et Vacances SA's (EPA:VAC) CEO For Now

Key Insights

• Pierre et Vacances to hold its Annual General Meeting on 8th of February
• Salary of €550.0k is part of CEO Franck Gervais's total remuneration
• The overall pay is comparable to the industry average
• Pierre et Vacances' EPS grew by 83% over the past three years while total shareholder loss over the past three years was 52%

In the past three years, the share price of Pierre et Vacances SA (EPA:VAC) has struggled to grow and now shareholders are sitting on a loss. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. The AGM coming up on the 8th of February could be an opportunity for shareholders to bring these concerns to the board's attention. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

View our latest analysis for Pierre et Vacances

How Does Total Compensation For Franck Gervais Compare With Other Companies In The Industry?

Our data indicates that Pierre et Vacances SA has a market capitalization of €596m, and total annual CEO compensation was reported as €1.1m for the year to September 2023. We note that's a small decrease of 7.4% on last year. Notably, the salary which is €550.0k, represents a considerable chunk of the total compensation being paid.

On comparing similar companies from the French Hospitality industry with market caps ranging from €368m to €1.5b, we found that the median CEO total compensation was €1.1m. So it looks like Pierre et Vacances compensates Franck Gervais in line with the median for the industry.

Component	2023	2022	Proportion (2023)
Salary	€550k	€550k	50%
Other	€547k	€634k	50%
Total Compensation	€1.1m	€1.2m	100%

Talking in terms of the industry, salary represented approximately 51% of total compensation out of all the companies we analyzed, while other remuneration made up 49% of the pie. Although there is a difference in how total compensation is set, Pierre et Vacances more or less reflects the market in terms of setting the salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Pierre et Vacances SA's Growth

Pierre et Vacances SA's earnings per share (EPS) grew 83% per year over the last three years. In the last year, its revenue is up 11%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Pierre et Vacances SA Been A Good Investment?

Few Pierre et Vacances SA shareholders would feel satisfied with the return of -52% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

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. That's why we did some digging and identified 1 warning sign for Pierre et Vacances that you should be aware of before investing.

Switching gears from Pierre et Vacances, 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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.