Is Stern Groep N.V.’s (AMS:STRN) CEO Salary Justified?

Henk Van der Kwast became the CEO of Stern Groep N.V. (AMS:STRN) in 2000. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Stern Groep

How Does Henk Van der Kwast’s Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Stern Groep N.V. has a market cap of €79m, and reported total annual CEO compensation of €665k for the year to December 2018. It is worth noting that the CEO compensation consists almost entirely of the salary, worth €644k. We examined a group of similar sized companies, with market capitalizations of below €180m. The median CEO total compensation in that group is €424k.

As you can see, Henk Van der Kwast is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Stern Groep N.V. is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous. You might want to check this free visual report on analyst forecasts for future earnings.

You can see a visual representation of the CEO compensation at Stern Groep, below.

ENXTAM:STRN CEO Compensation, October 23rd 2019
ENXTAM:STRN CEO Compensation, October 23rd 2019

Is Stern Groep N.V. Growing?

On average over the last three years, Stern Groep N.V. has shrunk earnings per share by 76% each year (measured with a line of best fit). In the last year, its revenue changed by just 0.8%.

Sadly for shareholders, earnings per share are actually down, over three years. And the flat revenue is seriously uninspiring. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration.

Has Stern Groep N.V. Been A Good Investment?

Stern Groep N.V. has not done too badly by shareholders, with a total return of 1.6%, over three years. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary…

We examined the amount Stern Groep N.V. pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. And while shareholder returns have been respectable, they have hardly been superb. So we think more research is needed, but we don’t think the CEO underpaid. Shareholders may want to check for free if Stern Groep insiders are buying or selling shares.

Important note: Stern Groep may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.