Is BVZ Holding AG's (VTX:BVZN) CEO Being Overpaid?
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Fernando Lehner has been the CEO of BVZ Holding AG (VTX:BVZN) since 2012. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for BVZ Holding
How Does Fernando Lehner's Compensation Compare With Similar Sized Companies?
Our data indicates that BVZ Holding AG is worth CHF181m, and total annual CEO compensation is CHF390k. (This figure is for the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at CHF269k. When we examined a selection of companies with market caps ranging from CHF99m to CHF395m, we found the median CEO total compensation was CHF797k.
A first glance this seems like a real positive for shareholders, since Fernando Lehner is paid less than the average total compensation paid by similar sized companies. Though positive, it's important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at BVZ Holding has changed from year to year.
Is BVZ Holding AG Growing?
Over the last three years BVZ Holding AG has grown its earnings per share (EPS) by an average of 28% per year (using a line of best fit). Its revenue is up 9.2% over last year.
This demonstrates that the company has been improving recently. A good result. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has BVZ Holding AG Been A Good Investment?
Most shareholders would probably be pleased with BVZ Holding AG for providing a total return of 81% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
In Summary...
It looks like BVZ Holding AG pays its CEO less than similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. And given most shareholders are probably very happy with recent returns, you might even think that Fernando Lehner deserves a raise!
It is relatively rare to see a modestly paid CEO when performance is so impressive. But it is even better if company insiders are also buying shares with their own money. Whatever your view on compensation, you might want to check if insiders are buying or selling BVZ Holding shares (free trial).
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.
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.
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.
