Shareholders May Not Be So Generous With Coima Res S.p.A.'s (BIT:CRES) CEO Compensation And Here's Why

In the past three years, shareholders of Coima Res S.p.A. (BIT:CRES) have seen a loss on their investment. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 22 April 2021 could be an opportunity for shareholders to bring these concerns to the board's attention. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

See our latest analysis for Coima Res

How Does Total Compensation For Manfredi Catella Compare With Other Companies In The Industry?

Our data indicates that Coima Res S.p.A. has a market capitalization of €253m, and total annual CEO compensation was reported as €604k for the year to December 2020. Notably, that's a decrease of 22% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €18k.

On examining similar-sized companies in the industry with market capitalizations between €167m and €668m, we discovered that the median CEO total compensation of that group was €485k. So it looks like Coima Res compensates Manfredi Catella in line with the median for the industry. Moreover, Manfredi Catella also holds €921k worth of Coima Res stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 52% of total compensation represents salary, while the remainder of 48% is other remuneration. A high-salary is usually a no-brainer when it comes to attracting the best executives, but Coima Res paid Manfredi Catella a nominal salary to the CEO over the past 12 months, instead focusing on non-salary compensation. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Coima Res S.p.A.'s Growth

Over the past three years, Coima Res S.p.A. has seen its funds from operations (FFO) grow by 17% per year. In the last year, its revenue is down 4.9%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Coima Res S.p.A. Been A Good Investment?

Since shareholders would have lost about 8.9% over three years, some Coima Res S.p.A. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Coima Res primarily uses non-salary benefits to reward its CEO. Shareholders have not seen their shares grow in value, rather they have seen their shares decline. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

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 Coima Res you should be aware of, and 1 of them makes us a bit uncomfortable.

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. 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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