How Should Investors React To YouGov plc's (LON:YOU) CEO Pay?
Stephan Shakespeare is the CEO of YouGov plc (LON:YOU). 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. 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 YouGov
How Does Stephan Shakespeare's Compensation Compare With Similar Sized Companies?
Our data indicates that YouGov plc is worth UK£626m, and total annual CEO compensation is UK£566k. (This figure is for the year to July 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at UK£257k. When we examined a selection of companies with market caps ranging from UK£326m to UK£1.3b, we found the median CEO total compensation was UK£946k.
A first glance this seems like a real positive for shareholders, since Stephan Shakespeare is paid less than the average total compensation paid by similar sized companies. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at YouGov has changed over time.
Is YouGov plc Growing?
YouGov plc has increased its earnings per share (EPS) by an average of 39% a year, over the last three years (using a line of best fit). It achieved revenue growth of 13% 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 decent revenue growth in the last year, suggesting the business is healthy and growing. Shareholders might be interested in this free visualization of analyst forecasts.
Has YouGov plc Been A Good Investment?
I think that the total shareholder return of 214%, over three years, would leave most YouGov plc shareholders smiling. 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 appears that YouGov plc remunerates its CEO below most similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. The pleasing shareholder returns are the cherry on top; you might even consider that Stephan Shakespeare deserves a raise!
Most shareholders like to see a modestly paid CEO combined with strong performance by the company. The cherry on top would be if company insiders are buying shares with their own money. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling YouGov (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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.
