The CEO Of EQT AB (publ) (STO:EQT) Might See A Pay Rise On The Horizon

Key Insights

• EQT's Annual General Meeting to take place on 27th of May
• Salary of €200.0k is part of CEO Christian Sinding's total remuneration
• The total compensation is 97% less than the average for the industry
• EQT's EPS declined by 27% over the past three years while total shareholder return over the past three years was 21%

Shareholders will probably not be disappointed by the robust results at EQT AB (publ) (STO:EQT) recently and they will be keeping this in mind as they go into the AGM on 27th of May. This would also be a chance for them to hear the board review the financial results, discuss future company strategy to further improve the business and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is fair and may even warrant a raise.

See our latest analysis for EQT

Comparing EQT AB (publ)'s CEO Compensation With The Industry

According to our data, EQT AB (publ) has a market capitalization of kr407b, and paid its CEO total annual compensation worth €200k over the year to December 2023. We note that's a decrease of 50% compared to last year. Notably, the salary of €200k is the entirety of the CEO compensation.

In comparison with other companies in the Swedish Capital Markets industry with market capitalizations over kr86b, the reported median total CEO compensation was €7.1m. That is to say, Christian Sinding is paid under the industry median. Furthermore, Christian Sinding directly owns kr9.0b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	€200k	€400k	100%
Other	-	-	-
Total Compensation	€200k	€400k	100%

Talking in terms of the industry, salary represented approximately 73% of total compensation out of all the companies we analyzed, while other remuneration made up 27% of the pie. Speaking on a company level, EQT prefers to tread along a traditional path, disbursing all compensation through a salary. 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 EQT AB (publ)'s Growth Numbers

Over the last three years, EQT AB (publ) has shrunk its earnings per share by 27% per year. It achieved revenue growth of 39% over the last year.

The decrease in EPS could be a concern for some investors. 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 EQT AB (publ) Been A Good Investment?

EQT AB (publ) has served shareholders reasonably well, with a total return of 21% 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.

To Conclude...

EQT rewards its CEO solely through a salary, ignoring non-salary benefits completely. Overall, the company hasn't done too poorly performance-wise, but we would like to see some improvement. If it manages to keep up the current streak, CEO remuneration could well be one of shareholders' least concerns. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

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 3 warning signs for EQT that investors should think about before committing capital to this stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.