Does Elekta AB (publ)'s (STO:EKTA B) CEO Salary Reflect Performance?

Richard Hausmann has been the CEO of Elekta AB (publ) (STO:EKTA B) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Elekta

How Does Richard Hausmann's Compensation Compare With Similar Sized Companies?

According to our data, Elekta AB (publ) has a market capitalization of kr44b, and pays its CEO total annual compensation worth kr15m. (This figure is for the year to April 2018). While we always look at total compensation first, we note that the salary component is less, at kr6.7m. We looked at a group of companies with market capitalizations from kr19b to kr59b, and the median CEO total compensation was kr11m.

It would therefore appear that Elekta AB (publ) pays Richard Hausmann more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

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

Is Elekta AB (publ) Growing?

On average over the last three years, Elekta AB (publ) has grown earnings per share (EPS) by 65% each year (using a line of best fit). It achieved revenue growth of 6.4% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Shareholders might be interested in this free visualization of analyst forecasts.

Has Elekta AB (publ) Been A Good Investment?

Boasting a total shareholder return of 97% over three years, Elekta AB (publ) has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

We compared total CEO remuneration at Elekta AB (publ) with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.

However we must not forget that the EPS growth has been very strong over three years. Even better, returns to shareholders have been plentiful, over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling Elekta shares (free trial).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this freelist of interesting companies.

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.