We Think Some Shareholders May Hesitate To Increase ABG Sundal Collier Holding ASA's (OB:ABG) CEO Compensation

Key Insights

• ABG Sundal Collier Holding will host its Annual General Meeting on 24th of April
• Salary of kr8.16m is part of CEO Jonas Strom's total remuneration
• The total compensation is 35% higher than the average for the industry
• Over the past three years, ABG Sundal Collier Holding's EPS fell by 26% and over the past three years, the total shareholder return was 3.9%

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

Share price growth at ABG Sundal Collier Holding ASA (OB:ABG) has remained rather flat over the last few years and it may be because earnings has struggled to grow at all. Some of these issues will occupy shareholders' minds as the AGM rolls around on 24th of April. They will be able to influence managerial decisions through the exercise of their voting power on resolutions, such as CEO remuneration and other matters, which may influence future company prospects. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

View our latest analysis for ABG Sundal Collier Holding

Comparing ABG Sundal Collier Holding ASA's CEO Compensation With The Industry

According to our data, ABG Sundal Collier Holding ASA has a market capitalization of kr3.5b, and paid its CEO total annual compensation worth kr14m over the year to December 2024. That's a notable increase of 53% on last year. Notably, the salary which is kr8.16m, represents a considerable chunk of the total compensation being paid.

For comparison, other companies in the Norway Capital Markets industry with market capitalizations ranging between kr2.1b and kr8.4b had a median total CEO compensation of kr11m. This suggests that Jonas Strom is paid more than the median for the industry. Furthermore, Jonas Strom directly owns kr37m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the broader industry, salary and other compensation roughly make up 50% each, of the total compensation. According to our research, ABG Sundal Collier Holding has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at ABG Sundal Collier Holding ASA's Growth Numbers

Over the last three years, ABG Sundal Collier Holding ASA has shrunk its earnings per share by 26% per year. Its revenue is up 14% over the last year.

The decline in EPS is a bit concerning. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that EPS has gone backwards over three years. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has ABG Sundal Collier Holding ASA Been A Good Investment?

With a total shareholder return of 3.9% over three years, ABG Sundal Collier Holding ASA has done okay by shareholders, but there's always room for improvement. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

In Summary...

The lacklustre share price returns along with the lack of earnings growth makes us think that a strong rebound in the share price may be difficult. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 2 warning signs (and 1 which is potentially serious) in ABG Sundal Collier Holding we think you should know about.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.