Yahoo Finance Should You Worry About Banca Popolare di Sondrio S.C.p.A.'s (BIT:BPSO) CEO Pay Cheque?
Mario Pedranzini has been the CEO of Banca Popolare di Sondrio S.C.p.A. (BIT:BPSO) since 2012. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
View our latest analysis for Banca Popolare di Sondrio S.C.p.A
How Does Mario Pedranzini's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Banca Popolare di Sondrio S.C.p.A. has a market cap of €899m, and reported total annual CEO compensation of €1.4m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at . Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of €364m to €1.5b. The median total CEO compensation was €946k.
As you can see, Mario Pedranzini is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Banca Popolare di Sondrio S.C.p.A. is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Banca Popolare di Sondrio S.C.p.A has changed over time.
Is Banca Popolare di Sondrio S.C.p.A. Growing?
Banca Popolare di Sondrio S.C.p.A. has increased its earnings per share (EPS) by an average of 15% a year, over the last three years (using a line of best fit). It achieved revenue growth of 5.8% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Banca Popolare di Sondrio S.C.p.A. Been A Good Investment?
Given the total loss of 35% over three years, many shareholders in Banca Popolare di Sondrio S.C.p.A. are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
We compared total CEO remuneration at Banca Popolare di Sondrio S.C.p.A. with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. However, the returns to investors are far less impressive, over the same period. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Banca Popolare di Sondrio S.C.p.A (free visualization of insider trades).
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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.
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. Thank you for reading.
