It Looks Like Shareholders Would Probably Approve Atlantica Sustainable Infrastructure plc's (NASDAQ:AY) CEO Compensation Package

It would be hard to discount the role that CEO Santiago Seage Medela has played in delivering the impressive results at Atlantica Sustainable Infrastructure plc (NASDAQ:AY) recently. Coming up to the next AGM on 04 May 2021, shareholders would be keeping this in mind. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

See our latest analysis for Atlantica Sustainable Infrastructure

Comparing Atlantica Sustainable Infrastructure plc's CEO Compensation With the industry

According to our data, Atlantica Sustainable Infrastructure plc has a market capitalization of US$4.4b, and paid its CEO total annual compensation worth US$2.5m over the year to December 2020. Notably, that's an increase of 50% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$757k.

For comparison, other companies in the same industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$2.0m. This suggests that Atlantica Sustainable Infrastructure remunerates its CEO largely in line with the industry average. What's more, Santiago Seage Medela holds US$804k worth of shares in the company in their own name.

Speaking on an industry level, nearly 20% of total compensation represents salary, while the remainder of 80% is other remuneration. It's interesting to note that Atlantica Sustainable Infrastructure pays out a greater portion of remuneration through salary, compared to the industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Atlantica Sustainable Infrastructure plc's Growth

Over the past three years, Atlantica Sustainable Infrastructure plc has seen its earnings per share (EPS) grow by 98% per year. The trailing twelve months of revenue was pretty much the same as the prior period.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Atlantica Sustainable Infrastructure plc Been A Good Investment?

We think that the total shareholder return of 144%, over three years, would leave most Atlantica Sustainable Infrastructure plc shareholders smiling. 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.

To Conclude...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

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. That's why we did our research, and identified 5 warning signs for Atlantica Sustainable Infrastructure (of which 2 are a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.

Important note: Atlantica Sustainable Infrastructure 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. 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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