Yahoo Finance Does Sbanken ASA's (OB:SBANK) CEO Pay Reflect Performance?
In 2010 Magnar Øyhovden was appointed CEO of Sbanken ASA (OB:SBANK). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Sbanken
How Does Magnar Øyhovden's Compensation Compare With Similar Sized Companies?
Our data indicates that Sbanken ASA is worth kr6.8b, and total annual CEO compensation was reported as kr3.8m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at kr2.8m. We examined companies with market caps from kr3.6b to kr15b, and discovered that the median CEO total compensation of that group was kr5.2m.
That means Magnar Øyhovden receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
The graphic below shows how CEO compensation at Sbanken has changed from year to year.
Is Sbanken ASA Growing?
On average over the last three years, Sbanken ASA has shrunk earnings per share by 2.2% each year (measured with a line of best fit). It saw its revenue drop 2.3% over the last year.
In the last three years the company has failed to grow earnings per share. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.
Has Sbanken ASA Been A Good Investment?
Sbanken ASA has served shareholders reasonably well, with a total return of 12% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Magnar Øyhovden is paid around what is normal the leaders of comparable size companies.
We feel that earnings per share have been a bit disappointing, but and we don't think the total returns are amazing. We do not think the CEO pay is a problem, but one might argue that the company should improve returns to shareholders before increasing it. So you may want to check if insiders are buying Sbanken shares with their own money (free access).
Important note: Sbanken may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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.
