Yahoo Finance Is Inchcape plc's (LON:INCH) CEO Paid At A Competitive Rate?
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In 1970 Stefan Bomhard was appointed CEO of Inchcape plc (LON:INCH). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
View our latest analysis for Inchcape
How Does Stefan Bomhard's Compensation Compare With Similar Sized Companies?
Our data indicates that Inchcape plc is worth UK£2.4b, and total annual CEO compensation is UK£2.3m. (This figure is for the year to December 2018). That's below the compensation, last year. While we always look at total compensation first, we note that the salary component is less, at UK£739k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£1.6b to UK£5.1b. The median total CEO compensation was UK£2.0m.
So Stefan Bomhard receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
The graphic below shows how CEO compensation at Inchcape has changed from year to year.
Is Inchcape plc Growing?
Inchcape plc saw earnings per share stay pretty flat over the last three years, albeit with a slight decrease, according to the line of best fit. It achieved revenue growth of 3.6% over the last year.
The lack of earnings per share growth in the last three years is unimpressive. The fairly low revenue growth fails to impress given that the earnings per share is down. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. It could be important to check this free visual depiction of what analysts expect for the future.
Has Inchcape plc Been A Good Investment?
Since shareholders would have lost about 2.9% over three years, some Inchcape plc shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Stefan Bomhard is paid around what is normal the leaders of comparable size companies.
After looking at EPS and total shareholder returns, it's certainly hard to argue the company has performed well, since both metrics are down. Few would argue that it's wise for the company to pay any more, before returns improve. Whatever your view on compensation, you might want to check if insiders are buying or selling Inchcape shares (free trial).
If you want to buy a stock that is better than Inchcape, this free list of high return, low debt companies is a great place to look.
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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.
