Most Shareholders Will Probably Agree With Olav Thon Eiendomsselskap ASA's (OB:OLT) CEO Compensation

Key Insights

• Olav Thon Eiendomsselskap will host its Annual General Meeting on 15th of May
• Salary of kr2.44m is part of CEO Dag Tangevald-Jensen's total remuneration
• The overall pay is 83% below the industry average
• Olav Thon Eiendomsselskap's EPS declined by 48% over the past three years while total shareholder return over the past three years was 54%

The performance at Olav Thon Eiendomsselskap ASA (OB:OLT) has been rather lacklustre of late and shareholders may be wondering what CEO Dag Tangevald-Jensen is planning to do about this. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 15th of May. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. In our opinion, CEO compensation does not look excessive and we discuss why.

Check out our latest analysis for Olav Thon Eiendomsselskap

Comparing Olav Thon Eiendomsselskap ASA's CEO Compensation With The Industry

At the time of writing, our data shows that Olav Thon Eiendomsselskap ASA has a market capitalization of kr23b, and reported total annual CEO compensation of kr2.5m for the year to December 2023. That's a notable increase of 16% on last year. In particular, the salary of kr2.44m, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies from the Norwegian Real Estate industry with market caps ranging from kr11b to kr35b, we found that the median CEO total compensation was kr14m. Accordingly, Olav Thon Eiendomsselskap pays its CEO under the industry median.

Component	2023	2021	Proportion (2023)
Salary	kr2.4m	kr2.1m	99%
Other	kr37k	kr35k	1%
Total Compensation	kr2.5m	kr2.1m	100%

Speaking on an industry level, nearly 94% of total compensation represents salary, while the remainder of 6% is other remuneration. Olav Thon Eiendomsselskap has gone down a largely traditional route, paying Dag Tangevald-Jensen a high salary, giving it preference over non-salary benefits. 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.

A Look at Olav Thon Eiendomsselskap ASA's Growth Numbers

Over the last three years, Olav Thon Eiendomsselskap ASA has shrunk its earnings per share by 48% per year. Its revenue is up 10% over the last year.

The decline in EPS is a bit concerning. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Olav Thon Eiendomsselskap ASA Been A Good Investment?

Boasting a total shareholder return of 54% over three years, Olav Thon Eiendomsselskap ASA has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Dag receives almost all of their compensation through a salary. Despite the strong returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about the stock keeping up its current momentum. These concerns could be addressed to the board and shareholders should revisit their investment thesis to see if it still makes sense.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Olav Thon Eiendomsselskap that investors should think about before committing capital to this stock.

Important note: Olav Thon Eiendomsselskap 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.