Yahoo Finance We Think Shareholders May Want To Consider A Review Of Criteo S.A.'s (NASDAQ:CRTO) CEO Compensation Package
Key Insights
Criteo will host its Annual General Meeting on 25th of June
CEO Megan Clarken's total compensation includes salary of US$665.0k
The total compensation is similar to the average for the industry
Over the past three years, Criteo's EPS fell by 0.5% and over the past three years, the total loss to shareholders 9.4%
The results at Criteo S.A. (NASDAQ:CRTO) have been quite disappointing recently and CEO Megan Clarken bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 25th of June. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.
Check out our latest analysis for Criteo
How Does Total Compensation For Megan Clarken Compare With Other Companies In The Industry?
At the time of writing, our data shows that Criteo S.A. has a market capitalization of US$2.0b, and reported total annual CEO compensation of US$9.2m for the year to December 2023. Notably, that's an increase of 30% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$665k.
On examining similar-sized companies in the American Media industry with market capitalizations between US$1.0b and US$3.2b, we discovered that the median CEO total compensation of that group was US$8.4m. So it looks like Criteo compensates Megan Clarken in line with the median for the industry. Furthermore, Megan Clarken directly owns US$19m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$665k | US$650k | 7% |
Other | US$8.5m | US$6.4m | 93% |
Total Compensation | US$9.2m | US$7.1m | 100% |
Speaking on an industry level, nearly 19% of total compensation represents salary, while the remainder of 81% is other remuneration. Criteo sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Criteo S.A.'s Growth Numbers
Earnings per share at Criteo S.A. are much the same as they were three years ago, albeit slightly lower. The trailing twelve months of revenue was pretty much the same as the prior period.
A lack of EPS improvement is not good to see. And the flat revenue hardly impresses. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Criteo S.A. Been A Good Investment?
Since shareholders would have lost about 9.4% over three years, some Criteo S.A. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Criteo that investors should think about before committing capital to this stock.
Important note: Criteo is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
