Does LightLab Sweden AB's (STO:LLSW B) CEO Salary Reflect Performance?
Johan Tingsborg became the CEO of LightLab Sweden AB (STO:LLSW B) in 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for LightLab Sweden
How Does Johan Tingsborg's Compensation Compare With Similar Sized Companies?
According to our data, LightLab Sweden AB has a market capitalization of kr109m, and pays its CEO total annual compensation worth kr1.6m. (This number is for the twelve months until December 2017). While we always look at total compensation first, we note that the salary component is less, at kr1.1m. We took a group of companies with market capitalizations below kr1.9b, and calculated the median CEO total compensation to be kr1.8m.
So Johan Tingsborg is paid around the average of 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 LightLab Sweden, below.
Is LightLab Sweden AB Growing?
Over the last three years LightLab Sweden AB has grown its earnings per share (EPS) by an average of 12% per year (using a line of best fit). It achieved revenue growth of 28% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 LightLab Sweden AB Been A Good Investment?
With a three year total loss of 69%, LightLab Sweden AB would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Johan Tingsborg is paid around what is normal the leaders of comparable size companies.
We like that the company is growing EPS, but it's disappointing to see negative shareholder returns over three years. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. Shareholders may want to check for free if LightLab Sweden insiders are buying or selling shares.
Important note: LightLab Sweden 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.
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.
