Mika Joukio has been the CEO of Metsä Board Oyj (HEL:METSB) since 2014. 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 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.
See our latest analysis for Metsä Board Oyj
How Does Mika Joukio's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Metsä Board Oyj has a market cap of €2.1b, and reported total annual CEO compensation of €1.8m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at €510k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. When we examined a selection of companies with market caps ranging from €908m to €2.9b, we found the median CEO total compensation was €1.1m.
It would therefore appear that Metsä Board Oyj pays Mika Joukio more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Metsä Board Oyj has changed over time.
Is Metsä Board Oyj Growing?
Over the last three years Metsä Board Oyj has grown its earnings per share (EPS) by an average of 28% per year (using a line of best fit). In the last year, its revenue is down 1.3%.
This shows that the company has improved itself over the last few years. Good news for shareholders. While it would be good to see revenue growth, profits matter more in the end. Shareholders might be interested in this free visualization of analyst forecasts.
Has Metsä Board Oyj Been A Good Investment?
With a total shareholder return of 7.1% over three years, Metsä Board Oyj has done okay by shareholders. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared total CEO remuneration at Metsä Board Oyj with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. We also note that, over the same time frame, shareholder returns haven't been bad. While it may be worth researching further, we don't see a problem with the CEO pay, given the good EPS growth. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Metsä Board Oyj.
If you want to buy a stock that is better than Metsä Board Oyj, this free list of high return, low debt companies is a great place to look.
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