João Nuno de Sottomayor de Castello Branco has been the CEO of Semapa - Sociedade de Investimento e Gestão, SGPS, S.A. (ELI:SEM) since 2015, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Semapa - Sociedade de Investimento e Gestão SGPS.
Comparing Semapa - Sociedade de Investimento e Gestão, SGPS, S.A.'s CEO Compensation With the industry
Our data indicates that Semapa - Sociedade de Investimento e Gestão, SGPS, S.A. has a market capitalization of €566m, and total annual CEO compensation was reported as €1.4m for the year to December 2019. This means that the compensation hasn't changed much from last year. Notably, the salary which is €761.2k, represents most of the total compensation being paid.
On examining similar-sized companies in the industry with market capitalizations between €341m and €1.4b, we discovered that the median CEO total compensation of that group was €895k. This suggests that João Nuno de Sottomayor de Castello Branco is paid more than the median for the industry.
Talking in terms of the industry, salary represented approximately 52% of total compensation out of all the companies we analyzed, while other remuneration made up 48% of the pie. Semapa - Sociedade de Investimento e Gestão SGPS is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Semapa - Sociedade de Investimento e Gestão, SGPS, S.A.'s Growth
Over the last three years, Semapa - Sociedade de Investimento e Gestão, SGPS, S.A. has shrunk its earnings per share by 9.9% per year. Its revenue is down 8.6% over the previous year.
The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Semapa - Sociedade de Investimento e Gestão, SGPS, S.A. Been A Good Investment?
Since shareholders would have lost about 55% over three years, some Semapa - Sociedade de Investimento e Gestão, SGPS, S.A. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
As we touched on above, Semapa - Sociedade de Investimento e Gestão, SGPS, S.A. is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Disappointingly, share price gains over the last three years have failed to materialize. What's equally worrying is that the company isn't growing by our analysis. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 2 warning signs for Semapa - Sociedade de Investimento e Gestão SGPS you should be aware of, and 1 of them doesn't sit too well with us.
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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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