Here's Why Shareholders May Want To Be Cautious With Increasing Allfunds Group plc's (AMS:ALLFG) CEO Pay Packet

Key Insights

• Allfunds Group will host its Annual General Meeting on 7th of May
• CEO Juan Alcaraz Lopez's total compensation includes salary of €1.26m
• Total compensation is 71% above industry average
• Allfunds Group's three-year loss to shareholders was 35% while its EPS was down 61% over the past three years

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Shareholders of Allfunds Group plc (AMS:ALLFG) will have been dismayed by the negative share price return over the last three years. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. The AGM coming up on 7th of May will be an opportunity for shareholders to have their concerns addressed by the board and for them to exercise their influence on management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders might be hesitant about approving a raise at the moment.

View our latest analysis for Allfunds Group

Comparing Allfunds Group plc's CEO Compensation With The Industry

Our data indicates that Allfunds Group plc has a market capitalization of €3.0b, and total annual CEO compensation was reported as €3.5m for the year to December 2024. We note that's an increase of 9.0% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €1.3m.

On comparing similar companies from the the Netherlands Capital Markets industry with market caps ranging from €1.8b to €5.6b, we found that the median CEO total compensation was €2.1m. Hence, we can conclude that Juan Alcaraz Lopez is remunerated higher than the industry median. What's more, Juan Alcaraz Lopez holds €366k worth of shares in the company in their own name.

Speaking on an industry level, nearly 36% of total compensation represents salary, while the remainder of 64% is other remuneration. Our data reveals that Allfunds Group allocates salary more or less in line with the wider market. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Allfunds Group plc's Growth Numbers

Allfunds Group plc has reduced its earnings per share by 61% a year over the last three years. Its revenue is up 16% over the last year.

Investors would be a bit wary of companies that have lower EPS On the other hand, the strong revenue growth suggests the business is growing. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 Allfunds Group plc Been A Good Investment?

The return of -35% over three years would not have pleased Allfunds Group plc shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

The company's earnings haven't grown and possibly because of that, the stock has performed poorly, resulting in a loss for the company's shareholders. In 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 is in line with their expectations.

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. That's why we did some digging and identified 1 warning sign for Allfunds Group that investors should think about before committing capital to this stock.

Important note: Allfunds Group is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.