Yahoo Finance Shareholders May Find It Hard To Justify A Pay Rise For SMA Solar Technology AG's (ETR:S92) CEO This Year
Key Insights
SMA Solar Technology will host its Annual General Meeting on 28th of May
Total pay for CEO Jurgen Reinert includes €1.19m salary
The total compensation is similar to the average for the industry
SMA Solar Technology's total shareholder return over the past three years was 4.3% while its EPS grew by 77% over the past three years
Under the guidance of CEO Jurgen Reinert, SMA Solar Technology AG (ETR:S92) has performed reasonably well recently. As shareholders go into the upcoming AGM on 28th of May, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.
View our latest analysis for SMA Solar Technology
Comparing SMA Solar Technology AG's CEO Compensation With The Industry
According to our data, SMA Solar Technology AG has a market capitalization of €1.6b, and paid its CEO total annual compensation worth €1.7m over the year to December 2023. Notably, that's an increase of 60% over the year before. In particular, the salary of €1.19m, makes up a huge portion of the total compensation being paid to the CEO.
On comparing similar companies from the German Semiconductor industry with market caps ranging from €921m to €2.9b, we found that the median CEO total compensation was €1.7m. So it looks like SMA Solar Technology compensates Jurgen Reinert in line with the median for the industry.
Component | 2023 | 2022 | Proportion (2023) |
Salary | €1.2m | €949k | 71% |
Other | €479k | €94k | 29% |
Total Compensation | €1.7m | €1.0m | 100% |
On an industry level, roughly 31% of total compensation represents salary and 69% is other remuneration. SMA Solar Technology pays out 71% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at SMA Solar Technology AG's Growth Numbers
SMA Solar Technology AG's earnings per share (EPS) grew 77% per year over the last three years. In the last year, its revenue is up 57%.
Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 SMA Solar Technology AG Been A Good Investment?
With a total shareholder return of 4.3% over three years, SMA Solar Technology AG has done okay by shareholders, but there's always room for improvement. Accordingly, a proposal to increase CEO remuneration without seeing an improvement in shareholder returns might not be met favorably by most shareholders.
To Conclude...
The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.
CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 3 warning signs for SMA Solar Technology (2 are potentially serious!) that you should be aware of before investing here.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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.
