Yahoo Finance Should You Worry About Tomra Systems ASA's (OB:TOM) CEO Pay?
In 2009, Stefan Ranstrand was appointed CEO of Tomra Systems ASA (OB:TOM). First, this article will compare CEO compensation with compensation at similar sized companies. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for Tomra Systems
How Does Stefan Ranstrand's Compensation Compare With Similar Sized Companies?
Our data indicates that Tomra Systems ASA is worth kr51b, and total annual CEO compensation was reported as kr9.7m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at kr5.5m. When we examined a selection of companies with market caps ranging from kr41b to kr124b, we found the median CEO total compensation was kr9.7m.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On an industry level, roughly 62% of total compensation represents salary and 38% is other remuneration. Tomra Systems is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation
So Stefan Ranstrand 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. You can see a visual representation of the CEO compensation at Tomra Systems, below.
Is Tomra Systems ASA Growing?
Tomra Systems ASA has seen earnings per share (EPS) move positively by an average of 7.1% a year, over the last three years (using a line of best fit). It achieved revenue growth of 8.7% over the last year.
I would argue that the improvement in revenue isn't particularly impressive, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Shareholders might be interested in this free visualization of analyst forecasts.
Has Tomra Systems ASA Been A Good Investment?
Boasting a total shareholder return of 254% over three years, Tomra Systems ASA has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
Remuneration for Stefan Ranstrand is close enough to the median pay for a CEO of a similar sized company .
While the growth could be better, the shareholder returns are clearly good. So all things considered I'd venture that the CEO pay is appropriate. Moving away from CEO compensation for the moment, we've identified 1 warning sign for Tomra Systems that you should be aware of before investing.
Important note: Tomra Systems 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.
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.
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