Is Digigram S.A. (EPA:DIG) Excessively Paying Its CEO?

The CEO of Digigram S.A. (EPA:DIG) is Jérémie WEBER. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Digigram

How Does Jérémie WEBER's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Digigram S.A. has a market cap of €1.2m, and reported total annual CEO compensation of €101k for the year to December 2018. Notably, the salary of €99k is the vast majority of the CEO compensation. We took a group of companies with market capitalizations below €185m, and calculated the median CEO total compensation to be €281k.

Most shareholders would consider it a positive that Jérémie WEBER takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.

You can see a visual representation of the CEO compensation at Digigram, below.

Is Digigram S.A. Growing?

Digigram S.A. has reduced its earnings per share by an average of 16% a year, over the last three years (measured with a line of best fit). The trailing twelve months of revenue was pretty much the same as the prior period.

Unfortunately, earnings per share have trended lower over the last three years. And the flat revenue hardly impresses. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Digigram S.A. Been A Good Investment?

Digigram S.A. has served shareholders reasonably well, with a total return of 16% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Digigram S.A. is currently paying its CEO below what is normal for companies of its size.

Jérémie WEBER is remunerated more modestly than is a normal at similar sized companies. But the company lacks earnings per share growth, and returns to shareholders are less than stellar. So while shareholders shouldn't be overly concerned about CEO compensation, we suspect most would prefer see improved performance, before increasing pay. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Digigram (free visualization of insider trades).

If you want to buy a stock that is better than Digigram, this free list of high return, low debt companies is a great place to look.

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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