How Should Investors React To Euronext's (EPA:ENX) CEO Pay?

Stéphane Boujnah has been the CEO of Euronext N.V. (EPA:ENX) since 2015, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Euronext pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Euronext

How Does Total Compensation For Stéphane Boujnah Compare With Other Companies In The Industry?

At the time of writing, our data shows that Euronext N.V. has a market capitalization of €6.1b, and reported total annual CEO compensation of €3.0m for the year to December 2019. We note that's an increase of 31% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €857k.

For comparison, other companies in the same industry with market capitalizations ranging between €3.4b and €10b had a median total CEO compensation of €3.4m. From this we gather that Stéphane Boujnah is paid around the median for CEOs in the industry. What's more, Stéphane Boujnah holds €2.1m worth of shares in the company in their own name.

Talking in terms of the industry, salary represented approximately 60% of total compensation out of all the companies we analyzed, while other remuneration made up 40% of the pie. Euronext pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Euronext N.V.'s Growth Numbers

Euronext N.V. has seen its earnings per share (EPS) increase by 14% a year over the past three years. It achieved revenue growth of 29% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Euronext N.V. Been A Good Investment?

We think that the total shareholder return of 93%, over three years, would leave most Euronext N.V. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

As previously discussed, Stéphane is compensated close to the median for companies of its size, and which belong to the same industry. Few would be critical of the leadership, since returns have been juicy and EPS are moving in the right direction. So one could argue that CEO compensation is quite modest, if you consider company performance! Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.

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've identified 2 warning signs for Euronext that investors should be aware of in a dynamic business environment.

Switching gears from Euronext, 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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