Shareholders May Not Be So Generous With Ferretti S.p.A.'s (HKG:9638) CEO Compensation And Here's Why

Key Insights

• Ferretti to hold its Annual General Meeting on 13th of May
• CEO Alberto Galassi's total compensation includes salary of €3.74m
• The total compensation is 2,490% higher than the average for the industry
• Ferretti's three-year loss to shareholders was 11% while its EPS grew by 20% over the past three years

Our free stock report includes 2 warning signs investors should be aware of before investing in Ferretti. Read for free now.

In the past three years, shareholders of Ferretti S.p.A. (HKG:9638) have seen a loss on their investment. 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 13th of May could be an opportunity for shareholders to bring these concerns to the board's attention. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

See our latest analysis for Ferretti

How Does Total Compensation For Alberto Galassi Compare With Other Companies In The Industry?

According to our data, Ferretti S.p.A. has a market capitalization of HK$6.9b, and paid its CEO total annual compensation worth €3.7m over the year to December 2024. That's a notable decrease of 16% on last year. Notably, the salary of €3.7m is the entirety of the CEO compensation.

For comparison, other companies in the Hong Kong Leisure industry with market capitalizations ranging between HK$3.1b and HK$12b had a median total CEO compensation of €144k. Accordingly, our analysis reveals that Ferretti S.p.A. pays Alberto Galassi north of the industry median.

Component	2024	2023	Proportion (2024)
Salary	€3.7m	€4.4m	100%
Other	-	-	-
Total Compensation	€3.7m	€4.4m	100%

On an industry level, roughly 92% of total compensation represents salary and 8% is other remuneration. At the company level, Ferretti pays Alberto Galassi solely through a salary, preferring to go down a conventional route. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Ferretti S.p.A.'s Growth

Ferretti S.p.A.'s earnings per share (EPS) grew 20% per year over the last three years. Its revenue is up 8.7% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Ferretti S.p.A. Been A Good Investment?

With a three year total loss of 11% for the shareholders, Ferretti S.p.A. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Ferretti pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. 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.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 2 warning signs for Ferretti (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

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.