Yahoo Finance Should You Worry About Ocado Group plc’s (LON:OCDO) CEO Pay?
In 2000 Tim Steiner was appointed CEO of Ocado Group plc (LON:OCDO). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for Ocado Group
How Does Tim Steiner’s Compensation Compare With Similar Sized Companies?
Our data indicates that Ocado Group plc is worth UK£5.3b, and total annual CEO compensation is UK£1m. That’s a modest increase of 3.8% on the prior year year. When we examined a selection of companies with market caps ranging from UK£3.1b to UK£9.2b, we found the median CEO compensation was UK£3m.
A first glance this seems like a real positive for shareholders, since Tim Steiner is paid less than the average compensation paid by similar sized companies. Though positive, it’s important we delve into the performance of the actual business.
You can see, below, how CEO compensation at Ocado Group has changed over time.
Is Ocado Group plc Growing?
On average over the last three years, Ocado Group plc has shrunk earnings per share by 62% each year. In the last year, its revenue is up 11%.
Sadly for shareholders, earnings per share are actually down, over three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth wto overlook the fact that earnings per share has gone backwards over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Ocado Group plc Been A Good Investment?
Boasting a total shareholder return of 116% over three years, Ocado Group plc has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary…
It looks like Ocado Group plc pays its CEO less than similar sized companies.
It’s well worth noting that while Tim Steiner is paid less than most company leaders (at similar sized companies), there isn’t much EPS growth. Having said that, returns to shareholders have been great. We would like to see EPS growth, but in our view it seems the CEO is remunerated reasonably. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Ocado Group plc.
Or you might prefer this data-rich interactive visualization of historic revenue and earnings.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
