Shareholders May Be More Conservative With Ocado Group plc's (LON:OCDO) CEO Compensation For Now

Key Insights

• Ocado Group will host its Annual General Meeting on 29th of April
• Salary of UK£815.0k is part of CEO Tim Steiner's total remuneration
• The overall pay is 56% above the industry average
• Ocado Group's EPS grew by 10% over the past three years while total shareholder loss over the past three years was 69%

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In the past three years, the share price of Ocado Group plc (LON:OCDO) 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. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 29th of April. They could also influence management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

View our latest analysis for Ocado Group

Comparing Ocado Group plc's CEO Compensation With The Industry

According to our data, Ocado Group plc has a market capitalization of UK£2.5b, and paid its CEO total annual compensation worth UK£2.6m over the year to December 2024. We note that's an increase of 34% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£815k.

In comparison with other companies in the British Consumer Retailing industry with market capitalizations ranging from UK£1.5b to UK£4.8b, the reported median CEO total compensation was UK£1.7m. This suggests that Tim Steiner is paid more than the median for the industry. What's more, Tim Steiner holds UK£59m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 24% of total compensation represents salary and 76% is other remuneration. It's interesting to note that Ocado Group pays out a greater portion of remuneration through salary, compared to the industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Ocado Group plc's Growth

Ocado Group plc has seen its earnings per share (EPS) increase by 10% a year over the past three years. In the last year, its revenue is up 4.9%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Ocado Group plc Been A Good Investment?

With a total shareholder return of -69% over three years, Ocado Group plc shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 2 warning signs for Ocado Group that investors should think about before committing capital to this stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.