A Quick Analysis On ABIVAX Société Anonyme's (EPA:ABVX) CEO Salary

This article will reflect on the compensation paid to Hartmut Ehrlich who has served as CEO of ABIVAX Société Anonyme (EPA:ABVX) since 2013. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

Check out our latest analysis for ABIVAX Société Anonyme

Comparing ABIVAX Société Anonyme's CEO Compensation With the industry

Our data indicates that ABIVAX Société Anonyme has a market capitalization of €444m, and total annual CEO compensation was reported as €411k for the year to December 2019. That's just a smallish increase of 3.5% on last year. We note that the salary portion, which stands at €267.8k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from €163m to €651m, the reported median CEO total compensation was €443k. From this we gather that Hartmut Ehrlich is paid around the median for CEOs in the industry.

On an industry level, around 51% of total compensation represents salary and 49% is other remuneration. It's interesting to note that ABIVAX Société Anonyme 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.

ABIVAX Société Anonyme's Growth

ABIVAX Société Anonyme has reduced its earnings per share by 33% a year over the last three years. In the last year, its revenue is down 98%.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has ABIVAX Société Anonyme Been A Good Investment?

Boasting a total shareholder return of 282% over three years, ABIVAX Société Anonyme has done well by shareholders. 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...

As we noted earlier, ABIVAX Société Anonyme pays its CEO in line with similar-sized companies belonging to the same industry. Some investors may take issue with this, especially considering shrinking EPS for the past three years. On the other hand, shareholder returns are showing positive trends over the same time frame. We do not think CEO compensation is a problem, but shareholders will probably want to see an increase in EPS before agreeing the business should pay any more.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for ABIVAX Société Anonyme you should be aware of, and 1 of them is a bit concerning.

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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